New Hampshire’s six-year run of business tax cuts should have made the state’s corporate income tax rate the second-lowest in New England. But a funny thing happened along the way. New Hampshire was joined by an unexpected rival. 

When the succession of cuts began in 2015, New Hampshire’s Business Profits Tax (BPT) rate was 8.5%, making it the third-highest corporate income tax in New England. Only Maine’s 8.93% rate and Connecticut’s 9% rate were higher. 

After the passage of the current state budget, New Hampshire’s BPT rate is down to 7.6%, a 10.5% cut in six years. (Legislators cut the Business Enterprise Tax by 27%.)

That makes New Hampshire’s rate lower than the top rate in Vermont (8.5%), Maine (8.93%) and Massachusetts (8%). 

But Connecticut, beset with fleeing businesses and a dwindling population, took measures to stop its own bleeding. It reduced its corporate income tax rate from 9% to 7.5%. 

Rhode Island’s rate has remained at 7% the entire time.

(Maine and Vermont have graduated corporate tax rates. Maine’s lowest corporate tax rate is 3.5%. Vermont’s is 6%.)

Because Connecticut lowered its corporate income tax rate by 1.5 percentage points, New Hampshire’s rate wound up moving down only one place, rather than two, among the New England states. 

This helps to illustrate an important point. States don’t act in a vacuum. 

Businesses aren’t trapped inside any jurisdiction’s borders. It’s a free country, and they can move if they find another location more hospitable. Which they sometimes do. Just ask California.

If each state could erect its own iron curtain, just imagine how high corporate and personal tax rates would be. 

But because it’s a free country, states sometimes find it in their best interest to lower rates to make themselves more attractive. 

That’s why Connecticut and New Hampshire weren’t the only places to lower corporate tax rates in the last six years. A few examples:

  • New York lowered its rate from 7.1% to 6.5%. 
  • Washington, D.C., dropped its rate from 9.4% to 8.25%. 
  • Florida cut its rate from 5.5% to 4.4%. 
  • Iowa slashed its rate from 12% to 9.8%. 
  • North Carolina cut its rate in half, from 5% to 2.5%. 

Some lawmakers prefer to ignore other states and pretend that corporate tax rates are simply a lever for raising revenue from existing businesses. Raise the lever, raise the revenue. Lower the lever, lower the revenue.

But people inside and outside a state’s borders react when those levers are raised or lowered. That’s a big reason why state tax rates change. 

This year, five states states have reduced business tax rates. Ten states have reduced individual income tax rates. The total number of states to reduce either business or individual income taxes is 11, not 15, though, as some states reduced both. 

Some notable examples:

  • Indiana decreased its corporate income tax rate from 5.25% to 4.9%
  • Idaho reduced its corporate income tax rate from 6.925% to 6.5%, retroactive to Jan. 1.

These follow numerous changes made last year, from Arkansas eliminating its top income tax bracket to Tennessee eliminating its tax on interest and dividends to New York eliminating and Illinois reducing its capital stock tax.

It’s true that some states raise rates. New Jersey added a new top corporate tax rate, going from 9% in 2015 to 11.5%. Of course, New Jersey also has earned the title of “Most Moved From State” for three years running (and it’s particularly good at losing higher-income people). In a free country, mistakes will be made. 

And in a free country, states compete for people, entrepreneurs and businesses. 

Freedom made New Hampshire an economic marvel. Recognizing that people are free to live wherever they want, state policymakers for decades have focused on making the Granite State as attractive as possible.

It has worked beautifully. New Hampshire’s economic growth has surpassed every other New England state’s, and the national average, since the late 1970s.

With a booming economy came a growing population, which has enhanced the state’s quality of life and kept New Hampshire from becoming Vermont — a dying state that pays people to move there. 

When people are free, there’s a limit to how bossy a state can be. And there are rewards for offering people more personal, political and economic autonomy. 

New Hampshire has figured this out. Other states are catching on, just as technology has made Americans more mobile than ever before.

The competition is not over. It’s just beginning. 

Since the beginning of February, unvaccinated individuals have accounted for 99% of New Hampshire’s COVID-19 cases and 98% of deaths, according to state data. The numbers indicate how extremely effective vaccines have been at fighting COVID-19 in the state.

From February 1 through June 23, the state recorded 33,703 COVID-19 cases, according to the state’s Joint Information Center, part of its Emergency Operations Center. Of those, only 349 involved people who had been fully vaccinated. That’s 1.03% of the total.

During the same period, 236 people have died from COVID-19. Only five of those were fully vaccinated. That’s 2.1% of the total.

Only 15 fully vaccinated individuals have been hospitalized for COVID-19 in New Hampshire,  according to the Joint Information Center.

Because of the way the state tracks hospitalizations, an exact percentage breakdown for hospitalized patients is not possible. The state records whether a patient was hospitalized at the time the case was reported to the state, but not whether hospitalization was required later. However, the state does track how many vaccinated people have required hospitalization for COVID-19 at any point. That number has totaled only 15. 

The Joint Information Center sets February 1 as the approximate date by which Granite Staters began to become fully vaccinated. 

A University of New Hampshire poll released Thursday reports that 25% of Granite Staters say they probably or definitely will not get the vaccine. 

Among that group, 56% say they don’t believe it will be effective at stopping them from getting COVID. 

The state data show that, contrary to this view, the vaccines are highly effective at reducing the risk of infection, serious illness and death from the coronavirus. 

The state figures also are similar to national data released last week. An Associated Press analysis of COVID-19 data from May found that 99.2% of COVID-19 deaths in the United States were among unvaccinated people. 

The difference between the 99% and 98% rates for New Hampshire cases and deaths, respectively, is not statistically significant, Beth Daly, chief of the state Bureau of Infectious Disease Control, said. (Dr. Daly’s comment was received after press time and was added to this story after publication.)

“The numbers are not really statistically different because you are comparing a small number (236) to a larger one (33,703).

“This is an issue of small numbers when you compare a denominator of tens of thousands to a denominator of just a few hundred. The confidence interval of 5 divided by 236 is from <1% to 5%, so the 1% observed in the calculation of 349 divided by 33,703 is not statistically nor meaningfully different from the proportion of deaths.

“To say it another way,  the proportion of vaccine breakthrough infections is statistically the same/no different from the proportion of vaccine breakthrough deaths. They are also not substantively different.”

 

The U.S. Supreme Court on Monday declined to hear New Hampshire’s lawsuit challenging the constitutionality of a Massachusetts rule taxing non-resident remote workers. The decision puts remote workers anywhere in the world at risk of having their incomes permanently taxed by the state where their employer is located. 

“It’s hard to see a limiting principle that would restrain states from taxing remote workers going forward, particularly given the Biden administration’s brief to the court arguing that states have the authority to do that,” Josiah Bartlett Center for Public Policy President Andrew Cline said. 

The Biden administration argued in a brief to the court that because remote workers benefit from government services provided to their employers, 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.”

Massachusetts’ rule was intended to be temporary for the duration of the COVID-19 emergency. However, six states already have permanent rules that tax the incomes of telecommuters who work from home for their own convenience. The Supreme Court’s decision to let Massachusetts’ rule stand not only keeps these rules in place, but could encourage the further expansion of remote worker taxation.

New York, Connecticut and four other states have what are known as “convenience of the employer” (COTE) rules that tax remote workers’ incomes if they work out-of-state for their own convenience, rather than out of necessity. 

Under these rules, if a remote worker has to work in another state, his or her income is not taxed. But if the worker chooses to work in another state purely for his or her personal convenience, the income is taxed. Arkansas, Connecticut, Delaware, Nebraska, New York, and Pennsylvania had COTE rules before the pandemic. The Tax Foundation has a good COTE explainer here

The Supreme Court’s refusal to hear New Hampshire’s case leaves such COTE taxation of remote workers intact. But it also has the strong potential to encourage blanket remote worker taxation under the Biden administration’s theory that states may tax any employee of a company located within their borders because state services benefit both the company and all of its employees.

The Biden administration’s brief could even prompt local governments to tax remote worker incomes. It specifically mentioned local services such as roads and fire protection as justifying the taxation of remote workers. 

Refusing to hear New Hampshire’s case does not mean that the issue is settled, Edward Zelinsky, professor at the Benjamin Cardozo School of Law in New York City, told the Josiah Bartlett Center. 

“I am disappointed that the Supreme Court would not hear this case but the Court’s denial is the beginning not the end of the process,” Zelinsky said. “It will now be necessary for individual taxpayers to start their own challenges to New York’s and Massachusetts’ unconstitutional taxation of remote workers. I am confident that these challenges will soon begin.”

Professor Zelinsky has sued New York over a similar remote taxation policy. He filed an amicus brief in New Hampshire’s case. The states of Connecticut, Hawaii, Iowa and New Jersey also filed briefs supporting New Hampshire. 

Writing in March for the American Bar Association, two Louisiana attorneys argued that a U.S. Supreme Court ruling on remote taxation is needed because the increasing prevalence of remote work is likely to generate more competition among states for revenues generated by the incomes of remote workers. 

“If states continue to struggle with declining tax revenues in 2021 and 2022, there will likely be even fiercer competition for those tax revenues between states where the employer and its primary offices are located and those whose residents, prior to the pandemic, regularly commuted to those states for work.”

The final House-Senate compromise added to this year’s state budget was a deal to give the Legislature more power during a declared state of emergency. This was an issue of heated debate, as many legislators thought the House and Senate needed a more active role in governing during a state of emergency. The compromise doesn’t go as far as some House members wanted, but it does enhance legislative authority in some important ways.

The Legislature’s existing emergency powers

Under existing law (RSA 4:45), both the governor and the Legislature have the power to declare a state of emergency. The Legislature can exercise this power by passing a concurrent resolution of both the House and Senate.

Once a state of emergency is in effect, the Legislature has the power to terminate it by passing a concurrent resolution in each chamber. 

One might have thought that the Legislature was powerless to act once an emergency had been declared. That is not the case. If a majority of legislators believes a state of emergency is no longer justified, or never was, it can convene and vote to end the emergency at any time. 

If the Legislature votes to end a state of emergency, the governor has the authority to declare “a new emergency for different circumstances.” That is, once the Legislature has ended a state of emergency, the governor cannot declare the same emergency for the same reasons again. Any new emergency would have to be based on “different circumstances.”

What the Legislature doesn’t have the authority to do under existing law is repeal a specific emergency order other than the emergency declaration itself. This was a big frustration for some House Republicans during the COVID-19 emergency. It also doesn’t have a process in place for reviewing states of emergency. It can convene itself at any time, but there is no calendar or schedule in place to generate periodic reviews automatically. 

Emergency powers enhanced in the budget

The Committee of Conference amendment rewrites RSA 4:45 to enhance legislative emergency powers in three specific ways.

  1. It requires the governor to notify the House and Senate of “impending” emergency orders “as soon as practicable” and to “provide a description of such orders.” This notification requirement ensures that legislative leadership will be informed prior to a declaration of emergency.  
  2. It gives the Legislature the power to terminate “any emergency order” in addition to the emergency declaration. This creates essentially a line-item veto for the Legislature. The General Court can keep a state of emergency in place but rescind any particular emergency order it doesn’t like. Currently, its only option is to repeal the state of emergency itself. Under the proposed change, legislators could partially co-manage an emergency by negotiating with the governor over the orders it would like to see. With the power to repeal any order, lawmakers would have a significantly increased say in what orders are made. 
  3. It requires the governor to call a legislative session 90 days into a state of emergency, and then every 90 days for the duration of the emergency if it lasts longer than the first 90 days. At each of these sessions, the Legislature is required to vote by concurrent resolution on whether to terminate the state of emergency. This forces a legislative vote every 90 days on whether to maintain or repeal a state of emergency.

These changes are not as comprehensive as some House members would have liked. But they elevate the General Court’s role during a state of emergency from spectator to co-manager. 

This year’s state budget, up for a vote on Thursday, contains an Education Freedom Account (EFA) program to give families more options for educating their children. Here is a quick summary of who has similar programs and how this one would work.

What is an EFA?

Nationally, these programs are known as Education Savings Accounts (ESAs). New Hampshire being New Hampshire, ours is called an Education Freedom Account.  Like other ESAs, it consists of a government-approved savings account that can be used for authorized educational expenses only.

The media routinely refer to the EFA program as a voucher, but it is not. Traditional vouchers pay for school tuition by sending a state payment directly to an education provider. An EFA does not work that way. With an EFA, the state deposits a student’s education grant into an approved savings account that is controlled by the parent. The parent may then choose to spend those funds on a list of approved educational expenses.

These restricted-use savings accounts are similar to a health savings account. Expenditures are limited to a list of legislatively approved uses. Qualified educational expenses include, to name a few, tuition and fees to private schools or other public schools, tuition and fees for non-public online learning programs, tutoring services, textbooks, curricula and other instructional materials, computer hardware, internet connectivity, other tech services, school uniforms, and educational services and therapies.

Where did EFAs come from?

Education Savings Accounts have been around for more than a decade and have been growing in popularity.

In 2020, five states had ESA programs: Arizona, Florida, Mississippi, Tennessee, and North Carolina. Arizona’s program started in 2011. About 4% of eligible students are participating in Arizona’s ESA program.

So far this year, 11 states have already passed at least one new or expanded educational choice bill, and legislation is pending in other states.

Kentucky and Missouri both passed ESA programs funded by donations for which donors erceive tax credits.

Indiana has created a new publicly funded ESA program to assist students with special needs and expanded the state’s tax-credit scholarships (both were passed in the two-year state budget).

West Virginia has passed an ESA program called the Hope Scholarship in which every student entering kindergarten or switching from public school is eligible for 100% of his or state education funds (about $4,600).

What do EFAs look like in New Hampshire?

New Hampshire’s EFA program has an income eligibility cap of 300% of the federal poverty level ($79,500 for a family of four).  The Josiah Bartlett Center estimates that just over 30 percent of New Hampshire families of school age children would qualify to apply for the program.

If approved, a family would have its state per-pupil education grant deposited into the EFA instead of sent to the district school. According to state Dept. of Education, the grant would average about $4,600 per student in the 2021-22 school year. As mentioned above, families could then use these funds to pay for a variety of educational expenses.

For the vast majority of students, the state will continue sending the adequate education grant directly to their assigned public school. But for families who choose an EFA, the money goes into the savings account. The Josiah Bartlett Center estimates that fewer than 1,000 students would take an EFA in the first year and around 2,000 in the second year. (You can read our study of the EFA proposal here.)

Our research also shows that Education Freedom Accounts would not raise property taxes or destroy school budgets. State aid to local schools would decline by only 0.024% in the second year of the program. And taxpayers would actually save $6.65 million in the first two years.

EFAs would not be the first educational choice program in New Hampshire. The state already has an education tax credit (ETC) scholarship for low-to-middle income families. Charter schools are independent public schools that exist in some communities. And, towns have long been allowed to tuition students to other schools.

These other choice options are extremely limited and are not available to many Granite State students. The Children’s Scholarship Fund-N.H., for example, manages a tax credit scholarship program that helped 626 students in the 2020-2021 school year. But about 800 students were left on a wait list.

Families of greater means have greater educational options. They can choose private schools or move to another school district. Education Freedom Accounts would offer lower-income families the ability to get the best education for their children too.

Funding public education doesn’t mean funding a school building. It means providing each student with the education that best fits that student’s needs. EFAs offer families a way to match their children with the education that works best for them.

UPDATE: This analysis has been updated to incorporate the Legislative Budget Assistant’s official tally of spending in the Committee of Conference budget.

 

The New Hampshire Legislature is scheduled to wrap up this year’s session on Thursday when the House and Senate convene to consider nearly 40 committee of conference reports hammered out by negotiators for each chamber, including the compromise version of the state’s two-year budget.

The conference committee budget would:

  • Cut state General and Education Trust Fund spending by roughly $172.5 million, or 3.1%,
  • Further lower business tax rates,
  • Eliminate the Interest and Dividends Tax, making New Hampshire truly income-tax-free,
  • Cut the statewide property tax while increasing aid to municipalities,
  • Create Education Freedom Accounts to provide school choice to lower-income families,
  • Prohibit the state from asserting, through employee training and K-12 education, that one demographic group is superior or inferior to others,
  • Create a voluntary paid family leave program;
  • Restrict abortions after 24 weeks,
  • Give legislators the power to repeal a state of emergency declaration.

Overview

This year’s budget fight was unusual in that it did not center on taxes and spending, or indeed on fiscal issues much at all. In fact, House negotiators accepted the Senate’s version of House Bill 1, which contains the detailed spending for each state agency, with no changes. Instead, the field of debate shifted to House Bill 2, the trailer bill that contains the policy changes necessary to implement the state’s $13.5 billion budget plan over the next biennium.

The Senate-approved version of HB 1 would spend $5.4 billion from the state’s General Fund and Education Trust Fund in Fiscal Years 2022 and 2023. This represents a reduction in state General and Education Trust Fund spending of approximately $172.5 million, or roughly 3.1% of state spending. (The committee of conference made some changes to HB2, which will have a very small effect on this figure. To make sure we’re using official state numbers, we use totals from the Senate budget, as the Legislative Budget Assistant has not made an official tally of the Committee of Conference budget.)

That is an historic achievement and would be the second time in this century that state spending declined from one budget to the next. (The last time was in the 2012-13 state budget passed in 2011.) General and Education Trust Fund spending is the portion of state spending paid for by state revenues, such as business taxes, the tobacco tax, the Meals and Rooms Tax, etc. Total spending, which includes federal outlays, is $13.5 billion in this budget.

Tax Cuts for Everyone

Since 2015, Republicans at the State House have been pushing to lower the rates of the state’s two largest business taxes. The Business Enterprise Tax is a levy of payroll and operating expenses paid by all but the state’s smallest businesses. The Business Profits Tax is paid on profits, and it is largely borne by larger businesses. Six years ago, New Hampshire had among the highest effective corporate tax rates in the nation, prompting the GOP to take up business tax reform as a key step to improving the New Hampshire Advantage. Showdowns over business tax rate cuts led to impasses between Gov. Maggie Hassan and the Republican-led Legislature in 2015 and between Gov. Chris Sununu and the Democratic State House majorities in 2019.

This year, Republicans hold majorities in both chambers, as well as the governor’s office, and that has meant more business tax cuts. This year’s budget would lower the BET to 0.55%, down from 0.75% six years ago. The BPT would drop to 7.6%, down from a high of 8.5% six years ago. Cutting the state’s two largest taxes on Granite State employers by 27% and 10.5% over the course of four budget cycles is an impressive legacy for Republican lawmakers that has helped the state’s economy. Thanks in part to business tax reform, New Hampshire business tax revenues have exceeded projections every year since rates began to fall. The Granite State now boasts a growing economy, higher state tax revenue, and an unemployment rate of 2.5%. Business tax rates are just the first of many tax cuts contained in this budget.

HB 2 would also increase the filing threshold for businesses paying the BET from $200,000 to $250,000, meaning that many of the state’s smaller firms would no longer have any business tax liability, while delivering a small tax savings to all BET filers. This was an idea originally proposed by Senate Democrats as an alternative to Republican tax rate cuts, but was included in addition to the rate cuts.

The budget deal begins to phase out the Interest and Dividends Tax entirely. This 5% tax on investment income above $2,400 hits hardest seniors who have planned to retire on their investment income. It has led critics to charge that New Hampshire has never been truly income tax free. The tax phases out over five years, dropping a percentage point each year. This puts New Hampshire on the path to becoming the ninth state to have no tax on personal income.

The budget reduces the Meals and Rooms Tax, a levy on restaurant and hotel bills, from 9% to 8.5%.

And finally, the budget incorporates the provisions of Senate Bill 3, which would shield New Hampshire businesses from tax liability on loans received through the federal Paycheck Protection Program.

Property Tax Relief

The most expansive set of tax changes occur on property taxes, which fund state, county, municipal, and school district expenditures. The final budget package includes a House provision lowering the Statewide Education Property Tax (SWEPT) by $100 million in 2023. This is a direct tax cut for every property owner in New Hampshire.

The budget also increases revenue sharing with municipalities under the Meals and Rooms Tax. While the last budget sent approximately 22% of these revenues back to cities and towns, this package sets revenue sharing at 30% and sets them aside in a newly created dedicated fund. Meals and Rooms Tax revenues have been a popular target for state budget writers in both parties over the past two decades. In total, this budget would increase M&R revenue sharing by $50.5 million to a total of $188 million.

The budget increases funding for county nursing homes by $29.1 million. It also prevents a drop in the state’s education funding formula caused by the drop in fall enrollments and the Free and Reduced Lunch program during the COVID-19 pandemic. Left unaddressed, this would have resulted in a $67 million reduction in state aid to local school districts. The budget also contains $30 million for school building aid, $35 million targeted to school districts with the greatest fiscal need, and $1.9 million for schools shifting to full-day Kindergarten.

Remarkably, the state budget would provide tax relief on all four sections of every Granite Stater’s property tax bill: state, county, municipal, and school.

School Choice

The Senate has included the provisions of SB 130, the Education Freedom Accounts Act, in HB 2. This expansion of school choice would provide New Hampshire families earning up to 300% of the federal poverty level with scholarships funded by the state’s adequate education grants. They could use these scholarships for a wide range of educational alternatives, including non-public schools, remote learning hardware and software, transportation costs, and even tuition at another public school or the New Hampshire Community College System. Our analysis projected that these accounts would save taxpayers $6.65 million in the first two years alone while improving student outcomes.

Late-Term Abortion

Currently, 43 states limit late-term abortions. The current budget package would add New Hampshire to that list, prohibiting the practice after the 24th week of pregnancy expect in cases where the procedure would protect the life, health, or well-being of the pregnant mother. The budget would also strengthen current state statutes barring the use of taxpayer funding for abortion services, requiring regular audits of abortion providers.

Critical Race Theory

Opposition to the teaching of Critical Race Theory in schools prompted responses in both the New Hampshire House and Senate. The House approach, House Bill 544, was a ban on “divisive concepts.” The Senate took a different tack, strengthening the state’s existing non-discrimination laws to prevent the the state, in training materials or in K-12 education, from asserting as fact that people of a particular age, sex, gender identity, sexual orientation, race, creed, color, marital status, familial status, mental or physical disability, religion, or national origin are inherently superior or inferior to any other. The Senate language, which also provides a legal path for those who believe they have been exposed to such discrimination, has been added to the state budget package in HB 2.

Emergency Powers

The final hurdle to a budget deal is a limit on the broad emergency powers granted by the New Hampshire Legislature to the governor following the attacks of September 11, 2001. The current emergency statute gives the House and Senate the authority to terminate any state of emergency declared by the governor by majority vote of both chambers. But it does not explicitly give the Legislature the authority to rescind individual emergency orders issued under such a state of emergency, nor does it provide a smooth path for such a resolution to come to floor of the House or Senate.

During the COVID-19 pandemic, Gov. Chris Sununu issued dozens of executive orders. Some were waivers of state regulations, enabling health care workers to provide treatment free from red tape or allowing restaurants to serve beer and wine to go. Others, such as the statewide mask mandate, met with opposition from conservatives and libertarians concerned about government overreach.

Last year, with the legislative session cut short and limited to brief meeting on the UNH campus, Democratic leaders blocked attempts by a handful of legislators to address the state of emergency. This year, lawmakers dealt with a number of bills curtailing the governor’s emergency powers or codifying emergency procedures into state law, but never voted on whether to end the overall state of emergency.

The House position would have maintained gubernatorial authority to declare an emergency, but would have required a vote of the House and the Senate for it continue past 30 days. The Senate position would have clarified the Legislature’s ability to address individual executive orders and would have allowed a governor to renew any order unless and until both the House and Senate voted to cancel it. This has been a major point of contention between the two chambers.

The final compromise contains elements of both approaches. Governors in future emergencies would be able to renew any emergency order. But should any state of emergency last as long as 90 days, the governor would need to explain the continued need directly to the Legislature, which would then vote in each chamber whether to terminate the state of emergency. Should majorities of both the House and Senate approve, the state of emergency would end immediately. Much like a veto override, both chambers would need to agree to rescind the governor’s directive, though by a simple majority vote of each.

This compromise would ensure that the Legislature would have the chance to affirm or deny a governor’s emergency declarations with an up for down vote. It gives legislators a considerable amount of power while maintaining a governor’s ability to act swiftly to respond to an emergency.

In sum, this budget represents the largest bundle of conservative policy achievements passed in a single bill in living memory.

When PepsiCo opened the first Pizza Hut in the Soviet Union in 1990, one challenge the company had was convincing Soviet bureaucrats that the cooks didn’t need to be trained chefs. 

“This is something the Russians don’t understand,”Andrew Rafalat, Pizza Hut’s regional director for the Soviet Union and Eastern Europe, told The New York Times in 1990. ”You don’t want trained cooks. You want kids off the street. Within a few weeks, they are the best pizza cooks in the world.”

Obviously, New Hampshire isn’t close to being the Soviet Union. (Burlington, Vt., is another story.) But New Hampshire is not as “live free or die” as Granite Staters would like to believe. 

Too many laws and ordinances here would look familiar to the Moscow bureaucrats who thought pizza cooks ought to be highly educated, credentialed and government approved. 

Recent legislation offers multiple examples.

Current law requires bars and restaurants to apply to the Liquor Commission for permission to serve drinks in common spaces such as sidewalks or parking lots, then also get permission from their local government. 

There’s no need for this double approval. Permission from the local government, is enough. Yet it took a global pandemic to convince lawmakers that this requirement should go.  

When the pandemic hit, already short-staffed nursing homes couldn’t fill positions to assist nurses because there weren’t enough licensed nursing assistants. 

Imagine telling the family of a nursing home patient that you’re sorry, but their loved one has to go with less care because the state has decreed that no care at all is better than care from someone who lacks the most prestigious credential. 

It took an emergency order to allow nursing homes to hire and quickly train unlicensed nursing assistants (called temporary health partners) to work under the supervision of licensed nurses. 

Senate Bill 155, which a committee of conference approved with amendments on Monday, would fix those and some other burdensome regulatory requirements.

Senate Bill 133, also approved by a committee of conference on Monday, addresses a few other occupational licensing laws. One fix is to open a path to licensure for the temporary health partners allowed in SB 155. 

Anyone who worked as a temporary health partner for at least 100 hours as a result of the pandemic would be considered as having completed a nursing assistant training course and would be eligible for licensure as a nursing assistant.

Associate teachers at child day care centers would get a similar break if SB 133 becomes law. The bill would allow 30 hours of “documented life experience” to substitute for 30 hours of “training in child growth and development.”

Also getting a break would be small restaurants and cafes. State law requires licensed food service establishments to have a “Certified Food Protection Manager.” The bill would let the CFPM (that doesn’t sound Soviet at all) for small operations be on call. 

The bill also would include psychologists in the list of medical professionals who can engage in telemedicine. (It’s crazy that this wasn’t allowed before.)

Then there are kids’ lemonade stands. Licensing kids’ lemonade stands would seem like a Moscow idea. But local municipal ordinances that require food vendors to obtain permits or licenses usually don’t have an exemption for children selling soft drinks in their own yards. 

Though there have been no news stories of police shutting down kids’ lemonade stands in New Hampshire, technically the stands are illegal if ordinances don’t specifically exempt them.

That’s why House Bill 183 would create a state-level exemption for children age 14 and younger who sell soft drinks from their own property. It establishes under state law that the only permission kids need to set up a lemonade stand is from their parents. (The House concurred with the Senate version last week and awaits Gov. Chris Sununu’s signature.)

These small changes would make New Hampshire a bit freer by slightly reducing the level of government permission needed for certain commercial practices. Other bills have addressed other areas where the pandemic revealed certain regulations to be entirely unneeded, even harmful. 

And yet, as this legislative session winds down, it’s remarkable how little has changed. The state of emergency is over. The pandemic is receding. But the state’s thick net of rigid regulations remains largely intact. 

Most changes were made on the margins. There was no comprehensive rewriting of occupational licensing laws or business regulations. Even after a wave of restaurant closures, lawmakers couldn’t bring themselves to allow cocktails to go. Massachusetts will legalize to-go restaurant cocktails before New Hampshire does. 

State laws and local ordinances remain run through with the presumption that people can’t figure out how to engage in economic activity safely unless they first obtain government permission and government-mandated training. 

A lot of good changes have been made. But we still can’t let go of the notion that 424 legislators should tell the pizza parlor how to make pizza. 

Summer weather is here, and restaurants from Portsmouth to Hanover are opening up for outdoor dining on streets and sidewalks. But unless the Legislature acts, those popular outdoor seating areas are in jeopardy when the state of emergency expires. 

State law doesn’t expressly allow holders of liquor licenses to add service in common areas, such as public sidewalks or parking lots. The relevant statute (RSA 178:24) addresses expansion of service into areas license holders control, but not into public spaces.

On May 31, 2020, Gov. Chris Sununu allowed restaurants to offer outdoor dining under Exhibit C of Emergency Order 40. (Local approval is required if the expansion is into a shared space, such as a sidewalk.)

The purpose was to give restaurants a chance of surviving the pandemic. People stopped going to restaurants when the pandemic hit last year, then the governor ordered indoor dining rooms closed. When they opened back up, people were reluctant to return. Allowing outdoor dining was intended to authorize restaurants to serve their customers in a way that is common in many other parts of the world, but not in New Hampshire. 

(We use the common term “outdoor dining” here, but really what the state’s regulating is the service of alcohol.)

Of course, the big question is: Why does state law interfere with sidewalk dining (drinking) in the first place? Why not just clarify that liquor license holders are not prohibited by the state from expanding into common spaces?

Senate Bill 155, as amended by the House, would do that. 

The House-passed version states that “a licensee may expand into a shared space, such as a sidewalk or street, with the approval of local officials.” The Senate version extended the temporary allowance for outdoor dining for another two years.

For the House amendment’s permanent authorization to become law, the Senate would have to agree to the amendment. The bill could come before the Senate for a vote on Thursday. 

In addition to allowing outdoor dining for liquor license holders, SB 155 would codify several other provisions contained in Gov. Chris Sununu’s COVID-19 emergency orders.

  • It would create a new legally recognized medical occupation called a “Temporary Health Partner,” which is essentially a nurse’s aid. When the pandemic hit, hospitals were short-staffed but could not bring in unlicensed assistants just to help with simple tasks. This would let medical providers hire helpers who would work under a nurse’s supervision. 
  • It would authorize the emergency medical licensure of various types of medial professionals, such as doctors who let their licenses expire within the last three years, and nursing students. 
  • It would let pharmacists sell COVID-19 testing kits and administer the tests. 
  • It would let out-of-state pharmacies providing investigational drugs to New Hampshire patients to be licensed as mail-order pharmacies temporarily for COVID-related reasons.
  • And it would let summer camps that temporarily closed for COVID-related reasons maintain their status under local ordinances as a continuously operating camp. It basically prevents their grandfathered status from being revoked because they closed during the pandemic. 

The bill offers a nice introduction into the world of unneeded state regulations. It would remove just a few of the many state laws that prohibit the private sector from serving customers in ways that lawmakers of the past either did not anticipate or did not want to allow, for whatever reason.  

If it passes, sidewalk dining could become a permanent part of New Hampshire life.

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