Despite being the main metropolitan area in the state, the City of Manchester’s zoning ordinances are surprisingly hostile to the construction of new multifamily housing. As a review of the city’s zoning ordinances championed by former Mayor Joyce Craig continues, aldermen are considering three relatively small changes unanimously approved by the Planning Board and brought forward by new Mayor Jay Ruais. 

These proposed amendments to the city’s zoning ordinances would represent a small but important step in the long-term effort to make the city’s zoning rules more friendly to new housing development. 

“Specifically, these amendments would help to make the construction of a few types of housing easier in the city by reducing regulatory barriers and by speeding up the permitting process,” Jeff Belanger, director of Planning and Community Development, told aldermen at a recent public hearing. 

The first change would allow four-unit housing to be built on lots currently permitting three-unit housing.

“The ordinance today establishes minimum lot sizes for developing multifamily or townhouse buildings with three dwelling units and then requires additional lot area for each additional dwelling unit,” Belanger explained. “The proposed amendments would change the minimum number of units that could be built on a lot from three to four, meaning that there could be an additional dwelling unit built on the minimum size lot.”

But for these changes to have any meaningful effect, the amendments also address parking requirements, reducing the required number of parking spaces for multifamily housing from 1.5 spaces per unit to one space per unit. 

“The proposed amendments for housing units would not be at all effective really if we didn’t also make adjustments to parking requirements,” Belanger said. “Parking requirements can really limit housing construction because parking takes up land area and adds costs. That’s especially true when it comes to three-family and four-family dwelling units because of the current parking requirements in the zoning ordinance.” 

In zoning districts that require 1.5 parking spaces per unit, the result is that three-family buildings need to set aside five parking spaces and four-family buildings need six parking spaces. And having that fifth parking space triggers an additional regulatory burden. According to Belanger, lots with at least five parking spaces must have a landscaped buffer around them, which costs time, money, and land area. 

Dropping the required number of parking spaces to one per unit would allow four-unit housing to be built on what is now the minimum lot size for three-unit housing, as three-unit and four-unit buildings would only need three and four parking spaces, respectively, keeping them below the five-space threshold. 

The third change would eliminate the need for property owners to receive a conditional use permit from the city’s Planning Board before building accessory dwelling units (ADUs) on their property, bolstering a property owner’s right to build an ADU.

“The benefit of exempting ADUs from Planning Board review is that it makes them faster and cheaper to permit,” Belanger told the aldermen. “Planning Board review usually takes about a month for an ADU application and there are fees associated with it. Both the delay and the fees would be eliminated with this proposal.”

Removing this red tape would help accelerate the construction of ADUs in Manchester, increasing the supply of units in the city and putting more people in homes. 

Interestingly, the Manchester Planning Board unanimously supports all three amendments, though they would take power away from the Planning Board itself. That is a sure sign of how pressing the need is for these types of reforms in the city. 

According to the New Hampshire Zoning Atlas, Manchester permits two-family housing on 23% of its buildable land and three-family, four-family, and five+-family housing on 21% of its buildable land as of 2023. 

That puts Manchester behind seven other cities in the state with respect to duplexes and six other cities with respect to larger multifamilies. (See our breakdown from last year of Manchester’s hostility to duplexes and other multifamilies here.)

“Manchester’s proposed zoning amendment is a modest but meaningful change that will probably result in a few dozen more apartments being built in scattered locations,” said Jason Sorens, senior research fellow at the American Institute for Economic Research and the principal investigator of the zoning atlas. “The city could go even further, especially since some of the changes merely bring the zoning in line with existing densities, but this change would start to chip away at the housing shortage in the city without causing noticeable changes in density at the neighborhood scale.”

There’s more the city can do to free up the supply of housing, such as further rolling back parking minimums, addressing minimum lot sizes, streamlining the permitting process for all types of construction, and opening up more buildable land for duplexes, just to name a few. But these proposed changes before the city now would start the much-needed process of reducing development costs and protecting residents’ property rights. 

“The proposed zoning amendments are not going to fix every housing problem in the city, but they are intended to at least help get at the cause of the housing crisis, which is a lack of supply,” Belanger explained. “They are intended to reduce regulatory barriers to housing production, while respecting the character of neighborhoods.”

State lawmakers are considering a slate of housing bills that would effectively override many municipalities’ zoning codes. And while some view such actions as constituting threats to local control—which New Hampshire rightfully cherishes—inaction on the part of local governments to loosen their own regulations may leave the state with no other choice. 

That is, unless cities like Manchester act first on these kinds of zoning amendments. 

 

This week, two bills that would take Education Freedom Accounts (EFAs) away from children enrolled in the program will be considered in the state House of Representatives. 

We previously summarized a group of bills that would heavily regulate the EFA program to the point that its functionality and growth would be severely curtailed. The House will vote on two of those bills on Thursday. They are House Bills 1512 and 1594. 

HB 1512 would limit funding for the EFA program from the Education Trust Fund to so-called budgeted amounts. Specifically, the bill states that Education Trust Fund payments for EFAs “shall not exceed $19,800,000 for fiscal year 2024, and in subsequent fiscal years shall not exceed the amounts appropriated for such purpose in the biennial state operating budget.”

In other words, regardless of actual enrollment, the bill would limit EFA appropriations to the sums that legislators estimate would be needed to cover EFA enrollment. Critically, the bill misrepresents the program as one whose funding is intended to be fixed annually by a set annual appropriation. It is not. Just like public schools, the EFA program’s funding is based on enrollment. 

The “appropriated” amount to which HB 1512 refers is an estimate. Existing law directs the governor to draw a warrant to cover any costs that exceed the estimate, should program enrollment prove larger than budget writers guessed. The bill would simply forbid that warrant article from exceeding the estimate, effectively capping EFA enrollment.

While presented as a measure to protect the Education Trust Fund from unanticipated withdrawals, HB 1512 is in fact an effort to prohibit the organic growth of EFAs. The bill does not address anything other than EFAs that might result in a larger-than-budgeted state education expenditure. Public schools experience fluctuating enrollment every year, and thus also pose a risk of draining more from the trust fund than was previously estimated. The number of students who have special needs or come from disadvantaged backgrounds also fluctuates annually, and increases in those numbers cause larger withdrawals from the Education Trust Fund.

The truth is that enrollment in all educational options fluctuates from year to year, and budgeted amounts are merely projections (educated guesses). Assuming that actual spending on any form of public education should align with previous budgeted guesses would be a little like assuming that election results should align precisely with pre-election polling. The budgeted amount is the guess. The actual enrollment numbers are reality. It’s not the other way around.

Lawmakers accounted for those annual enrollment fluctuations when they designed the EFA program. That’s why the EFA statute lets its funding shrink or grow depending on actual program participation. 

As written, HB 1512 would change the EFA program to a set line item in the state’s biennial budget, though that’s not what it was intended to be. Funding for the EFA program is based on enrollment, just like public school spending is. This is the appropriate way to fund both.

The main argument for this legislation is the claim that the EFA program is “way over budget.” That’s not accurate, in that the statute funds the program based on enrollment, not a set line item in the budget. HB 1512, however, would bind the program to a set budget line while failing to hold the state’s spending formula for public education to the same standard. 

Taking EFAs away from kids while costing taxpayers more

This fundamental change in EFA funding would forcibly revoke EFAs from some children who currently have them because the program has already grown beyond the bill’s proposed spending limit. 

In the current fiscal year, appropriations for the EFA program are upwards of $22 million. Those appropriations are to meet the needs of the 4,933 enrolled students, a number that’s increased by 201.7% since the program’s inception and is expected to only keep growing, as the program is popular among families who seek an alternative to their children’s assigned public school. 

The bill also would increase, not cut, total education spending. The EFA program provides a publicly funded education at a fraction of the average per-pupil expenditure for New Hampshire public schools, which is currently $20,323 from all sources, state, local, and federal. The average per-pupil adequate education grant for an EFA is $5,255. Every student who moves from an EFA back to their assigned public school costs taxpayers more money, not less. 

Finally, HB 1512 seeks to solve a problem that doesn’t even exist. The Education Trust Fund is growing, not shrinking. Despite funding both public schools and EFAs, the Education Trust Fund ended the 2023 fiscal year with a surplus of $161 million and is projected to finish this fiscal year with a surplus of $232 million. 

Moreover, since public school enrollment has been falling for the last two decades and is expected to continue declining, the resulting extra money in the trust fund (even with the budgeted limit) would simply sit there unused as more and more students leave their government-assigned district public schools and enroll elsewhere. EFAs change that, allowing those students to take their per-pupil grants with them.

Another way to take EFAs away from kids

As HB 1512 attempts to cap the finances behind the EFA program, HB 1594 would further limit those who can participate in the program.

HB 1594 would establish “an annual review and qualification to determine eligibility to participate in the education freedom accounts program.” If a participant’s household income goes over the income cap (currently 350% of the federal poverty level) in any year, then that participant would cease to be eligible for the program and would lose the EFA.

Existing law requires that the income limit be met only when applying. That was done to provide continuity for families and prevent children from being sent back to an educational environment that didn’t work for them just because their family’s income grew during their time in school. 

But HB 1594 would effectively remove an EFA student from the program if, for example, his or her single parent making the average teacher’s salary in the state earned a raise of just $5,000. 

Cloaked under the guise of reigning in a “fiscally reckless” program, these regulations are specifically designed to force children back into their assigned public schools, even though their families have decided that those schools are not the best educational environments for them. 

These bills would remove students currently using EFAs from the program, which could be a jarring or even traumatic experience for some. 

They also would reduce competition in a growing educational marketplace by hamstringing the state’s largest school-choice program—one that saves taxpayers money. (See “Bartlett report shows that Education Freedom Accounts will save taxpayer money, improve student outcomes” and  “As NH public school district enrollment fell by 30,000 students in 19 years, spending rose by nearly $1 billion.”

Ultimately, each of these bills would not just restrict the growth of the EFA program but kick children out of it who are currently enrolled. They would do this in the name of protecting the Education Trust Fund, which enjoys a healthy surplus that is projected to exceed $200 million.   

The rest of the proposed measures to restrict EFAs—HB 1418, 1592, 1610, 1654, and SB 525—are due out of committee next week.



 

Imagine you own a small entertainment venue in New Hampshire. What’s the value of an aisle seat in Row 37 on a Wednesday night in April?

Let’s say you printed the date, the time and a price of $100 on the ticket. Would that make the ticket worth $100? How about $200?

No idea, right?

You don’t have enough information to answer that question. You first have to know: 1.) Who’s playing that night, and 2.) How much are people willing to pay to sit in that seat in that venue at that time for that artist?

The number of people interested in renting that seat for two hours on a Wednesday night would vary along with the popularity of the artist. That number would be lower for a Dead Kennedy’s show than for a Dua Lipa show. (Yes, we know who Dua Lipa is. Kind of.)

Everybody understands that the value of sitting in that particular seat for any given two-hour period is not fixed. It depends on who is on the stage, when, where, for how long, etc. In other words, the value depends entirely on demand. It doesn’t matter what price you print on the ticket if that price doesn’t reflect the actual demand for that seat at that time. 

So why do so many lawmakers (and consumers) assume that ticket prices set by venue operators reflect actual market value?

Venues have a lot of information that helps them set ticket prices. But ticket prices are not the same as ticket values. And extensive research into ticket prices has shown that venues and artists routinely underprice tickets relative to their market value for many reasons, including the desire to encourage sellouts (which maximizes concessions revenue) and avoid annoying fans.

“To maximize profits a promoter wants a sell-out as this maximizes complementary revenues and introduce the ‘crowd effect,’ meaning that consumers who believe a concert will be a sell-out are more attracted to the event and demand for tickets will intensify,” Hofstra University music industry professor Terrance Tompkins wrote in the International Journal of Music Business Research in 2019.

Industry professionals confirm what researchers have found.

“Average secondary ticket prices remain close to double that of a primary ticket, continuing to show the extent to which concerts and other live events remain priced below market value,” Music Business World, an industry publication, quoted Joe Berchtold, Live Nation’s President and Chief Financial Officer, as saying in a recent earnings call.

That huge gap between the retail price of event tickets and their market value drives the growth in the secondary market. People and policymakers like to hate on “scalpers.” But there wouldn’t be much of a secondary market if retail prices better reflected market value.

Concert ticket prices have risen dramatically in recent decades, reflecting a rise in demand and a rise in disposable income among the concert-going public. But generally speaking, retail prices often remain below market value, particularly for the most popular shows.

Senate Bill 328 would try to address this gap between price and value by imposing a price cap on the secondary market. Deceptively presented as a bill to ban deceptive resale practices, its last section forbids the resell of event tickets above face value.   

That’s a price cap, and price controls are bad. Banning the resale of tickets for more than face value won’t change the actual market value of tickets for popular events. It will create shortages in legitimate secondary ticket markets and stimulate a separate black market for event tickets. 

The Federal Trade Commission looked into ticket reselling in 2019 and organized a presentation by University of Chicago economist Eric Budish, who concluded, as so many other researchers have, that this market was driven by low retail ticket prices. 

“The structural economic issue is artists/teams sometimes want to ‘underprice’ their tickets relative to what the market will bear,” Budish concluded. “This creates an incentive for rent-seeking behavior.” (That means it creates an incentive for people to buy tickets at their obviously low prices and make a profit by selling them at the market price.)

The FTC suggested that only three ticket-selling options exist:

1. Set a market-clearing price in the primary market.

2. Set a below-market price in the primary market. Much of the “real” allocation will happen in the secondary market.

3. Set a below-market price in the primary market + ban resale.

Option 2 describes the current market, which is obviously not ideal. 

Option 3 describes the market as imagined in SB 328. This is also not ideal, as it would not solve the underlying problem but would expand the unregulated black market for tickets. It also likely would do little to curtail high markups in the secondary market, as law enforcement agencies rarely waste valuable officer time pursuing ticket resellers, which resellers know. 

The best option is Option 1: setting a market-clearing price in the primary market. There’s research to show that this has highly positive effects.

Budish, the Chicago economist who presented to the FTC in 2019, later worked with Bank of America economist Aditya Bhave to study Ticketmaster’s short-lived experiment in auctioning a portion of tickets for concerts in the early 2000s. In a study published last year, they compared set prices and auction prices in the primary market to the prices for comparable tickets to the same shows in the secondary market. 

Not surprisingly, they found that auctioning tickets instead of selling them for a set, below-market price all but eliminated the gap between retail and secondary market prices. And instead of scalpers collecting the difference between the set price and the market price, the artists did. 

When fans paid the market price directly to the venue, rather than to a reseller, “artist revenues roughly doubled,” they found.

The auctions allowed fans to find the market-clearing price before resellers could, which “eliminated or at least substantially reduced potential resale profits for speculators.”

Unfortunately, Ticketmaster discontinued its auctions. Fans, unaccustomed to paying market prices at the retail level, didn’t like it. And so the secondary market continued to grow, and resellers, rather than artists, enjoyed the benefits of selling tickets for their true market value.

Auctions would be the most efficient way to find the true market value of an event ticket, but venues could get close to that value in other ways. They could raise prices for the most valuable seats at the most popular shows, charge significantly higher prices when tickets first go on sale to discourage mass reseller purchases, or delay sales until closer to the show date. 

Venues also could choose to ban resales and require purchasers to show a photo ID at the door. But this doesn’t go over well with fans. It’s much easier to demand that lawmakers prevent resellers from making a profit. 

Lawmakers certainly can pass laws making it illegal to sell tickets at market prices. But they can’t ban the laws of economics. People will find ways to sell tickets at market value. It’s better that venues do this in the primary market. If they choose not to do this, ticket purchasers will–even if legislators tell them not to. Moving market-priced tickets from the legal market to the black market isn’t good for anyone and would be the worst of all options.

As pressure builds for local and state policymakers to address New Hampshire’s severe housing shortage, some activists and lawmakers are again blaming developers rather than regulators for the state’s high rents. 

Developers are building “too many” apartments for higher-income renters, some claim. This raises rents, hurting the poor, so government must intervene to make builders reserve a certain percentage of new construction for lower-income households, the argument goes. Some also want the state to give subsidies to low-income renters. 

The idea that building more apartments raises rents has achieved the status of conventional wisdom in some activist circles. It’s done so despite it being untrue, and confirmed untrue by growing stacks of economic evidence. 

Even academics repeat the claim. A California political science professor, in a February opinion column for New Hampshire Bulletin, wrote that “construction in the high-end ‘luxury’ rental market, which drives up rents for everyone else, remains in an upward trend.”

In fact, building more market-rate apartments reduces rents for middle-and lower-income households. This has been well established in academic research for years. And recent studies have provided more detailed confirmation of the effect.

A review of recent research on the subject finds:

  • Researchers at the Upjohn Institute and Federal Reserve Bank of Philadelphia found in 2019 that new market-rate apartment buildings “decrease nearby rents by 5 to 7 percent relative to locations slightly farther away or developed later.” They made a point of stating that the evidence ran against common complaints about market-rate apartment construction. “Contrary to common concerns, new buildings slow local rent increases rather than initiate or accelerate them,” they wrote.
  • A 2020 study by the National Multifamily Housing Council Research Foundation found that a “substantial flow of new construction apartments, largely targeted to middle- and higher-income groups, has enabled the ‘filtering’ process to create affordable housing opportunities for low-income households,” as a summary of the report put it. 
  • NYU researchers in a 2018 paper sought to answer claims that building market-rate apartments raised rents. “We ultimately conclude, from both theory and empirical evidence, that adding new homes moderates price increases and therefore makes housing more affordable to low- and moderate-income families.” They also noted that housing shortages are caused by regulations, not new construction. “Despite the arguments raised by supply skeptics, there is a considerable body of empirical research showing that less restrictive land use regulation is associated with lower prices. The evidence takes many forms. A large number of cross-sectional studies show that stricter (less strict) local land use regulations are associated with less (more) new construction and higher (lower) prices.
  • A 2021 UCLA review of recent studies on the effects of building market-rate apartments found overwhelming evidence that new construction of market-rate units lowers rents. Referencing the NYU paper cited above, the authors wrote: “Since that article came out two years ago, at least six working papers have been released that examine the connections between market-rate housing production and affordability at the neighborhood level. Four of the papers conclude that market-rate development makes nearby housing more, not less, affordable. The fifth paper looks at rents across entire cities rather than at the  neighborhood level, but finds that new development causes rents to fall for units across the income distribution. Findings in the sixth paper are mixed, and offer some reason to think new development makes nearby housing more expensive. Although the papers await peer review, and readers should bear that in mind, the importance and near-unanimity of their findings makes discussing them worthwhile.”

Building luxury or higher-end apartments draws higher-income renters out of yesterday’s luxury apartments and into the new luxury apartments. Increased vacancies in yesterday’s luxury apartments attract higher-income residents who’ve been living in mid-level apartments. As new construction creates more vacancies, rents come down. That effect filters throughout the housing supply, lowering rents all the way down. Economists call this “filtering,” and it’s an effect thoroughly established in academic and industry studies of rental housing markets. 

There’s no doubt that filtering occurs when enough new apartments are built. It can’t occur, though, if government prevents developers from creating those new high-end apartments. The problem in recent years has not been the creation of too many high-end apartments, but too few.

Harvard’s Joint Center for Housing Studies pointed this out in 2020: 

“What is different about the recent dynamic is that new construction is accommodating a growing number of high-income households, but just barely. Indeed, despite the relatively high rents, the number of new apartment units being added each month is scarcely keeping up with growth in units rented out, or ‘absorbed’ by new renters. When new construction is only just meeting demand from new high-income renters, it means that, in effect, new high-end units are being rented out by new, high-income renters, rather than by current high-income renters trading up to a newer unit, and therefore fewer old units are left to ‘filter down’ to a lower-income renters.”

In other words, when developers are allowed to build more market-rate apartments, rents come down for everyone. When they aren’t, rents stay high. 

Enticing people to buy electric vehicles does not fit comfortably into the core duties of state government. And yet it’s among the list of pet causes legislators will consider subsidizing with other people’s money. 

The latest effort comes in House Bill 1472. The bill, as amended, would confiscate $1.5 million that belongs to electric utility ratepayers in New Hampshire and give it to people who buy or lease electric vehicles. The money would come from Regional Greenhouse Gas Initiative (RGGI) funds currently rebated to ratepayers. 

The bill would facilitate this wealth transfer by creating a program through which EV buyers could claim rebates of $2,000 per fully electric vehicle and $1,000 per plug-in hybrid vehicle. Eligible vehicle sticker prices would be capped at $50,000 for cars and $80,000 for trucks, SUVs or commercial vans. 

Rebates would be available to individuals making no more than $75,000 a year, heads of household making no more than $112,500, and married couples making no more than $150,00 a year. The median household income in New Hampshire, according to the U.S. Census Bureau, is $90,845. So HB 1472 would create a program through which moderate-and lower-income Granite Staters subsidize pricier-than-average car purchases for higher-income households. 

The idea behind this subsidy plan, as with most subsidies, is to use some people’s money to manipulate other people’s behavior. The beneficiary group in this case is middle-income car buyers. The victim group is everyone who uses electricity. To give middle-income car buyers up to $2,000 toward the purchase of a car that runs on electricity (mostly generated by nuclear fission or natural gas in New Hampshire), the scheme takes about $2 per year from the average residential electricity user. 

If timing is everything, then this bill is a party guest who arrives not three hours—but three years— late. The wealth transfer scheme comes amid a rapid decline in EV prices. 

Cox Automotive and Kelly Blue Book reported this month that EV prices fell 10.3% between January of 2023 and January of 2024. Prices for the Tesla Model Y, the best-selling EV in America, fell by 21% last year, from $63,000 to less than $50,000. 

EV prices are rapidly approaching price parity with conventional gas-powered vehicles. The price gap between EVs and conventional vehicles fell from 15% in 2022 to 8% in 2023 to just 4% at the start of 2024, according to industry news site CarEdge. At this rate, average EV prices could reach parity with conventional vehicle prices this year, which undermines any argument in favor of a subsidy. 

Federal subsidies and policies so distorted the EV market that automakers have built far more electric cars than consumers wanted. Though demand for EVs is rising, supply has risen far faster, leading manufacturers to slash prices to move excess inventory. Pushed to generate more EVs than consumers want at the moment, auto makers are losing billions of dollars on these government-favored vehicles. 

“Buyers looking to get a bargain on a new car might want to consider an electric vehicle,” The Wall Street Journal wrote in a news story on EV prices last November.

As a JD Power auto analyst explained to Newsweek in December: “Eventually manufacturers will achieve scale and profitability, but they are being pressured to accelerate the production of EVs at an unnatural rate due to various government initiatives.”

This is a cautionary tale about the unintended consequences of market manipulation. As lawmakers consider proposals to add a state subsidy for EVs, and subsidize other favored products or activities, it’s one worth heeding. 

A surprising divide has arisen this year over how the state should respond to increasing volumes of public records requests. On one side, we see discord and anger. On the other, unity and progress. The split shows the value of a win-win approach to solving problems.

Many officials responsible for providing access to public records say requests for such documents have become burdensome and costly. They say that gadflies and for-profit companies are filing such large requests, with such frequency, that something must be done to reduce the burden on public employees.

Two bills in the Legislature attempt remedies. The solutions they offer are diametrically opposed. Both would lighten the work load of public employees. But how they propose to do so makes all the difference.

House Bill 1002, which we wrote about previously, proposes to solve the problem by making it harder for citizens to obtain public documents. It would allow government agencies to charge up to $25 an hour for records requests that take more than 10 hours to fulfill, with the billing kicking in after the 10th hour begins. 

House Bill 1696, as amended, takes a very different approach. The bill would make it easier for municipalities to store, and the public to retrieve, public records. It would create a system for municipalities to have their records stored at the state Division of Archives and Record Management. To manage those records, and requests for them, it would fund a Local Government Records Manager position at the archives. 

HB 1696 would create a digital repository of government records that would work like “a slightly more boring version of Netflix for public records,” New Hampshire Municipal Association Government Affairs Counsel Natch Greyes told the House Judiciary Committee in January. 

State Archivist Ashley Miller told the Judiciary Committee that the bill “streamlines our record-keeping processes statewide but it allows… for quick retrieval of information.’

She went on to say that the bill would create “a convenient digital repository where their records can be both preserved and accessible to the public.”

This version of HB 1696 was sponsored by Rep. Josh Yokela, who is well known for championing broad and easy access to public records. Yet the bill has the support of the New Hampshire Municipal Association and the director of the Division of Archives and Records Management. The House Judiciary Committee unanimously recommended its passage. Why?

Rep. Yokela offered a solution that satisfied both sides. Municipal officials received help with storing public records and fulfilling requests for them. Advocates of government transparency got a searchable, always-accessible database of public records.

By contrast, HB 1002’s win-lose approach imposed costs on open-government advocates and gave government employees a new, easily abused power. Pitting the two sides against each other led to bad feelings, acrimonious debate and reconsideration of the bill. 

HB 1696 doesn’t resolve all of the concerns public records custodians have. But it points toward constructive solutions.

Instead of discouraging records requests by punishing citizens when they ask for large batches of public documents, a win-win approach would encourage better records management practices, offer help in complying with large requests, and create a less labor-intensive process for making records available. 

Creating a better way to redact non-public portions of public documents remains a challenge. But suppressing records requests is not the solution. 

As with so many problems, the answer can be found through innovation and cooperation, not power and punishment. 

All power residing originally in, and being derived from, the people, all the magistrates and officers of government are their substitutes and agents, and at all times accountable to them.  Government, therefore, should be open, accessible, accountable and responsive.  To that end, the public’s right of access to governmental proceedings and records shall not be unreasonably restricted.

— New Hampshire Constitution, Part 1, Article 8

 

Some local government officers in New Hampshire (and elsewhere) have reported being burdened by what they view as unreasonable requests for massive caches of records. 

House Bill 1002 attempts to address these complaints. It would allow public bodies to charge up to $25 an hour for the time taken to fulfill a public records request when a request lasts more than 10 hours. The fees would not apply to the first 10 hours, but would kick in at the start of the 11th hour.

In effect, the bill would tax any public record request that public officials say takes longer than 10 hours to fulfill. 

The perverse incentive created by HB 1002 is obvious. If it becomes law, public officials would have a new incentive to take as much time as possible to answer public records requests. By expanding the estimated time taken to fulfill requests, government agencies could discourage requests they view as burdensome or annoying.

Government officials who testified in favor of the bill in Concord said it was needed to discourage frivolous, harassing and financially motivated records requests. Legislators were told that out-of-state companies request data that is then monetized, and that citizens file requests just to harass government employees.

But this bill does not narrowly target those problems. It applies a fee to any request that a governing body can stretch into 10 hours worth of work. 

The inevitable effect will be to reduce government accountability by reducing public access to public records. 

A study of high records request fees published last fall in Government Information Quarterly found that “fees are particularly problematic for certain requester types, notably average citizens and those seeking records in the public interest, and that fees may therefore obstruct the public’s ability to become informed and better self-govern.”

Lawyers and companies seeking data for commercial purposes did not see high fees as an impediment to making public records requests, according to the survey.

This suggests that the approach taken by HB 1002 would reduce government oversight while doing little to discourage financially motivated documents requests.

If harassing or overly broad records requests really are a serious problem in New Hampshire (all we have are some anecdotes), legislators can devise a more narrowly tailored remedy that does not suppress legitimate records requests made in the public interest.

Fees that apply only to data sought by commercial actors for strictly commercial purposes (which would exempt news media and citizen requests) might be an option, though it’s not at all clear that such requests are so burdensome that they require a legal remedy. 

Requests made for the purpose of disrupting government work or harassing government employees should be addressed through statutes prohibiting harassment, not by imposing fees on citizens who want access to records that, after all, belong to them.

One reason public records requests can take many hours to fulfill is that government agencies often have poor records retention practices. Citizens shouldn’t be punished for disorganization in government bureaucracies. 

Providing ready access to public records is a core government function, not an add-on. Good management involves properly organizing and staffing the agencies tasked with storing, managing and producing public records. Charging people extra for the time it takes to produce poorly organized documents will do nothing to improve the organizational efficiency of government bureaucracies and might actually discourage it. 

The core conceptual flaw in HB 1002 is that it treats public records as government property and access to those records as a burden on government employees. 

In fact, public records belong to all citizens, and government employees are merely custodians of those records on behalf of their citizen owners. 

Currently, public agencies can charge for making copies of public records. That distinction is important. Copying fees are permitted because the charge is for the duplication, not for access to the record.

HB 1002 crosses an important line. It imposes a fee just for accessing the records. That upends the relationship between citizen and government. It gives government the ability to withhold public records from any citizen who can’t afford to pay. 

“A system that puts a price on it is on its face discriminatory,” Rep. Marjorie Smith said when opposing the bill a House Judiciary Committee hearing earlier this month. “It is going to, on its face, hurt people at the lowest end of the income scale. It is going to set up different classes of people as to whether or not you’re entitled to get information.”

The decline of print journalism has decimated newsrooms in New Hampshire. With fewer reporters covering local and state government, sometimes the only people providing any government oversight are citizens who watch public meetings and file public records requests. Empowering government to charge for access to those records would further shrink the already tiny level of government oversight that remains.  

 

 

Join us for a New Hampshire Primary party hosted by the Josiah Bartlett Center and The Dispatch

When: 6 p.m., Wednesday, Jan. 17th, 6 p.m.

Where: Grappone Conference Center, 70 Constitution Ave., Concord

What: Enjoy cocktails, camaraderie & conversation with Steve Hayes, Jonah Goldberg & Sarah Isgur of The Dispatch and Josiah Bartlett Center President and WFEA radio host Drew Cline

Details: 6-7 p.m.: Cocktail reception with our Dispatch & Josiah Bartlett Center hosts; 7-8 p.m.: A fun conversation & Q&A with Steve, Jonah, Sarah & Drew

On the menu: Heavy hors d’oeuvres, a cash bar & raffle prizes!

Only $20 per person!

 

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The Josiah Bartlett Center has warned for the last few years that local government inaction on housing might prompt legislators to restrict local zoning authority. But legislators might have an even stronger incentive to act than the growing public frustration with local land use regulations: Falling revenue.

A combination of high interest rates and an extreme shortage of homes on the market has pushed housing affordability to a two-decade low in the state. Though interest rates clearly play a role, the New Hampshire Association of Realtors points out that supply remains the primary culprit. “It’s a lack of inventory that continues to push pricing to record heights,” the association wrote last month.

Home prices have fallen a bit in New Hampshire since hitting a record in October. But that’s not because the market has improved. Rather, interest rates are keeping some potential buyers on the sidelines, causing a decline in the number of aggressive bidding wars. When interest rates ease, buyers will return to a market still plagued by a severe inventory shortage.

No one knows how long interest rates will remain high. If the squeeze of high rates and low inventory continues to push buyers out of the market, New Hampshire could see a prolonged home sales slump. And that will be felt in Concord. In fact, it already has been.

For the first five months of the 2024 fiscal year, real estate transfer tax revenues are down 20%, or $23 million. That’s the largest decline of any state tax this year. 

We know what some are probably thinking right now. “But what about Interest & Dividends tax revenue?” Eliminating that tax, as state law does by the end of next year, will have a larger impact on the state budget. 

But the I&D tax phaseout is part of a strategy to make New Hampshire more economically competitive. The anticipated tradeoff is that making the state more attractive to investors, retirees and entrepreneurs will generate greater economic activity, and thus greater economic growth, in the long term. 

There is no such tradeoff with falling home sales. A $50 million annual decline in real estate transfer tax revenue caused by falling home sales is simply lost revenue. 

Worse, it reflects shrinking economic activity in an important industry, which will have ripple effects in the broader economy. Lawmakers have made clear that they want state policy to stimulate economic growth. Local policies that hurt economic growth, such as overly restrictive land use regulations, are increasingly being scrutinized by legislators. 

Though state lawmakers and local boards are unable to affect interest rates, they can do something about the housing supply. They can lift regulatory burdens that block or restrict new home construction. 

So far, legislators have been reluctant to preempt local regulations. Yet with  polls showing that most Granite Staters want government to address the state’s housing shortage, pressure is increasing on legislators to act. Falling state revenue by itself probably wouldn’t trigger state action. Combined with rising political pressure to act, though, it becomes another incentive for legislators to do something. 

So local boards (and voters at town meeting) have another warning sign. The longer local governments wait to clear the way for more home construction, the more likely it becomes that legislators will do it themselves. 

Most of New England has some work to do to keep up with New Hampshire’s status as the nation’s freest state.

In the latest edition of the Cato Institute’s Freedom in the 50 States report, while New Hampshire finishes first in overall freedom (an index of personal and economic freedom), the other five New England states each finish in the bottom half among all 50 states.

Overall freedom:

  • New Hampshire: #1
  • Massachusetts: #26
  • Connecticut: #33
  • Rhode Island: #36
  • Vermont: #42
  • Maine: #43

When breaking down the rankings, all New England states do well on personal freedom (Connecticut being the lowest ranked at No. 16), but New Hampshire rises above the rest on economic freedom.

Economic freedom:

  • New Hampshire: #1
  • Massachusetts: #32
  • Connecticut: #33
  • Rhode Island: #37
  • Vermont: #43
  • Maine: #45

The two components of the economic freedom index are fiscal and regulatory freedom, on which New Hampshire also scores much higher than its regional neighbors.

Fiscal freedom:

  • New Hampshire: #2
  • Massachusetts: #18
  • Connecticut: #20
  • Rhode Island: #22
  • Maine: #41
  • Vermont: #46

Regulatory freedom:

  • New Hampshire: #17
  • Massachusetts: #39
  • Connecticut: #40
  • Rhode Island: #42
  • Vermont: #43
  • Maine: #45

Needless to say, all of New England, New Hampshire included, could use some regulatory reform. (These rankings accounted for laws enacted as of December 31, 2022, meaning New Hampshire’s universal license recognition law didn’t make the cut.)

In the Fraser Institute’s Economic Freedom of North America 2023, New Hampshire is first in economic freedom among all North American jurisdictions, while Connecticut is the next “freest” at No. 25 among just the 50 U.S. states. After that, it’s Massachusetts (28th), Maine (41st), Rhode Island (42nd), and Vermont (48th).

How free your state is directly affects many important outcomes. One is the movement of people.

“Fiscal, regulatory, and personal freedom are all independently, positively, statistically significantly correlated with net in-migration,” write William Ruger and Jason Sorens, authors of Freedom in the 50 States.

It’s no surprise, then, that New Hampshire is winning the migration game. According to data collected by Kenneth Johnson at the UNH Carsey School of Public Policy, the Granite State experienced a net migration gain of 18,300 in 2021 and 2022. Forty-four percent of those migrants came from Massachusetts, 8% came from Maine and Vermont combined, and 14% came from elsewhere in the Northeast.

New Hampshire was one of only two New England states to see its population increase every year from 2018–2022, growing to nearly 1.4 million today—a 6% increase since 2010—while a state like Vermont sits at about 647,000 people. (The other was Maine, which saw a migration surge during the COVID-19 pandemic.)

Net in-migration isn’t something New Hampshire can take for granted. More people died in the Granite State than were born in 2021 and 2022, and New Hampshire consistently has one of the lowest birth rates in the country, meaning the state’s recent population growth has been entirely due to those moving into the state.

And what explains the Granite State’s net migration gain? “One channel by which economic freedom affects in-migration is by increasing economic growth,” Ruger and Sorens write. “We found a robust relationship between economic freedom in one year and income growth in the next.”

The bottom line is that freedom isn’t just valuable in its own right (which it is). Freedom, fundamentally, leads to greater economic opportunity and prosperity. More freedom generally means more of the other two as well.

New Hampshire’s median household income of $83,449 is $15,000 higher than Vermont’s and $20,000 higher than Maine’s.

While the rest of New England champions increased government spending for social programs and public welfare, higher tax rates, more regulation, and top-down control over education and the economy, they get in return lower levels of economic opportunity, growth, and prosperity than New Hampshire does.