Nov 24, 2014 4:20 PM
The election is over, it's back to governing and Governor Maggie Hassan is facing a big, state budget headache.
Business tax breaks and soaring Medicaid rolls combine to turn a tight budget into a river of red ink.
"But as we continue to deal with the revenue shortfalls and increased caseloads at Health and Human Services, we must also take strategic action to keep the budget balanced,'' Hassan told the Legislative Fiscal Committee Monday.
Hassan took her first step offering up $18 million in cuts including a one-year longer wait for communities with water and sewer projects and less spending on marketing and technology.
"These cuts, as you know, will not be easy,'' Hassan said.
NH1 News confirmed that some of the cities and towns that lose out through the cuts in the grants-in-aid program include Hudson, Lebanon, Peterborough, Amherst, Tilton and Bristol.
The University System of New Hampshire gave up $3 million and community colleges kicked in another half million.
Last June the state budget ended in surplus, but it was $7 million less than expected.
During Hassan's re-election campaign, Republican nominee Walt Havenstein accused the Governor of over-spending and pegged the state budget hole at up to $70 million between now and June 30, 2015.
The House-Senate fiscal panel endorsed Hassan's cuts though Senate Republicans urged the Governor to communicate better with them about future needed action on spending.
Senate Majority Leader Jeb Bradley pushed back with his claim business tax breaks Republicans granted in 2011 weren't too blame.
"Maybe we have a 4.3 percent unemployment rate as the result of those business incentives that I think we wisely adopted a couple of years ago and postponed to the next budget but we have that discussion on another day,'' Bradley said.
Hassan fired back, "We can continue to have that discussion.''
On the tax breaks, former Gov. John Lynch had vetoed the one giving large benefits to certain trust holders but the Republican-led Legislature overrode that move.
Hassan said Monday the dilemma is both a spending and revenue problem.
"This is actually a mixed challenge and I think we need to be candid about that,'' Hassan said.
And there are more cuts to come.
"We will need to continue to work together to provide more cuts that require legislative approval,'' Hassan said.
A bill is needed to carry out cuts to the budgets for the legislative and judicial branches.
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