May 29, 2015 11:53 AM
NH1 News Political Report: May 28, 2015 - The must-read, weekly NH political tip sheet
The bid for a late-in-the-legislative session tax break that we saw at the State House this week was not an unusual event.
What was unique was the company in question - Planet Fitness - was brazen enough to request it in person.
We only need look at the budget cycle four years ago for a case in point.
Telecommunication companies in the cable TV business desperately wanted to exempt from the telecommunications tax the connections of users to access their data.
It was no secret who wanted this break - Comcast number one, Verizon Wireless number two.
But neither firm came forward to request the tax break; instead they hired well-connected lawyer/lobbyists to make the case for them that this tax treatment was unfair.
Over the objections of then-Gov. John Lynch, the Republican-dominated Legislature gave the tax break which supporters said would cost the state treasury no more than $5 million a year.
In the first year after the change, returns from the telecommunications tax plummeted $25 million.
By going public with their demands, Planet Fitness makes the tax break about its brand and behavior as a corporate citizen and not the principle of whether hitting a business hard with higher taxes that goes public is a disincentive to be located in New Hampshire.
And the company’s choice of a chief salesman is even more curious.
Former Gov. Craig Benson emerged from near-political hibernation to lobby for the change. Benson failed to mention at the hearing that he has been a board member with the company and identified in public relations news coverage as one of its ``leading owners.’’
Let’s set that aside for a moment and think about the messenger.
Benson is the same entrepreneur who in the early 1990s long before becoming governor sued the state over the unfairness of the same Business Profits Tax Planet Fitness is now assaulting.
Oh yes: Benson also at various points said he might have to expand his Cabletron Systems Corp. high tech business outside New Hampshire if business taxes weren’t changed.
The suit did not prevail but it ultimately convinced then-Gov. Steve Merrill to champion a new, broad-based tax on business activity, the low-rate Business Enterprise Tax.
The chances of this tax break becoming law aren’t high despite its high-powered political support.
Why? The tax break going to the full Senate next week is part of a piece of legislation separate from the state budget (HB 550).
Unless Gov. Maggie Hassan were to become a surprise supporter, Democrats could easily uphold a veto of the tax break.
All of this changes, however, should Senate leaders try to shoe horn this issue into the talks over a compromise state budget.
This would be unusual but again not without precedent. The ill-fated limited liability tax (LLC tax) that’s since been repealed only surfaced during compromise budget talks as then-Gov. John Lynch and legislative leaders searched for more revenue to balance the books.
There’s still time for Senate President Chuck Morse, R-Salem, and other supporters to try and work their magic and make the change palatable to Hassan and partisan Democrats.
Secretary of State Bill Gardner is seeing red.
The last thing he would want as this session wraps up is yet another drag-out battle with the Local Government Center, this one about Gardner’s Bureau of Securities Regulation should lose oversight over LGC’s insurance risk pools.
But Health Trust President Peter Bragdon knows a lot about political timing as a former Senate president himself.
So he registers as a lobbyist last week just as the Senate Finance Committee is voting to move the risk pools under the Insurance Department.
This is a longstanding campaign by the LGC that predates Bragdon coming aboard to lead the health trust.
The unanswered question is whether this proposal was a sweetener Senate leaders at the time broached with Bragdon two years ago to get him to agree to resign from the Senate.
Don’t expect Gardner to give up this easily.
He’s been reaching out to Republican senators individually hoping to convince them to support his position that the LGC should stay put.
Gardner reportedly already has a good chance of landing two GOP converts - Sens. Andy Sanborn, R-Bedford, and Kevin Avard, R-Nashua.
Even if all 10 Senate Democrats stand with him, however, that’s not enough.
He needs 13 of the 24 to agree to have this section of the state budget trailer bill (HB 2) taken out.
The long-dormant campaign to reform the worker’s compensation system came alive this week.
A key House panel endorsed, 10-8, along party lines a sweeping change to try and place a break on soaring medical costs for those who are injured on the job.
A coalition of business groups pushed for a fee schedule that exists in more than 40 states.
But both medical providers and hospitals pushed back saying it fails to recognize that individual nature of these injuries.
State Rep. Will Infantine, R-Manchester, championed the reform that requires insurers only pay a "reasonable basis" for the procedure.
The amendment also permits payments to go above those reasonable fees due to the geographic location of the case, the specialty service being delivered and the complexity of the injury.
Democrats on the House panel maintain the change would create a dizzying, bureaucratic network that could lead to delays in service for injured workers as they sort out how much they will be reimbursed.
The full House of Representatives will debate the proposal next week which is a top priority of the House GOP agenda.
Once the State Senate’s Republican caucus broke down over a fee schedule last spring it looked like this issue was over for 2015.
But behind the scenes, Infantine and a working group met with stakeholders and state officials and now they’ve come up with this hybrid.
Gov. Maggie Hassan and Senate budget writers traded shots at week’s end about the spending plan.
Here’s a key illustration of how much both sides have been talking over rather than with one another.
Senate Finance Committee Chairman Jeanie Forrester, R-Meredith, said she hasn’t met with Hassan once since becoming the chief budget writer in January.
"Without communication, there is no consensus," said Forrester asked why this Senate budget debate has split so sharply along partisan lines.
For example, Forrester maintains that while the state payraise costing $10 million was finalized months ago, she did not hear from either Hassan or Senate Democrats to find money for it until the middle of this week.
"In case after case, we listened to the pleas of folks and the Senate Finance Committee responded," Forrester said. "When it comes to the contract, people didn’t reach out to us."
Sources close to the governor say Forrester's statement is not accurate. They maintain Hassan has in fact had Senate GOP leadership meetings in which Forrester was there during this session. In addition they add while Hassan met with other Senate GOP leaders about the budget recently, Forrester was not there.
Putting legislative leaders on the University System Board of Trustees even a few years ago would be unthinkable.
The higher education system has jealously guarded its autonomy from the state budget process.
They present the Legislature a request for state aid to support their four-year colleges and universities. Unlike state agencies, state budget writers don’t get to go through their books or change a single planned expenditure in higher education.
This has always been a perennial frustration for legislative leaders of both political parties but it’s been decades since a serious effort was made to challenge it.
Enter Senate President Chuck Morse, R-Salem.
Along party lines, Senate budget writers slipped into that budget trailer bill a plan for the House speaker and the Senate president [-] or their partisan designees - to be non-voting members.
Morse softened the original proposal which was to give the lawmakers voting rights and this change also as proposed would be on a trial basis and these appointments end Dec. 1, 2018 unless the Legislature extended them.
The always frank Morse made it clear where he was coming from this time, clearly agitated that higher education administrators would not commit to freezing in-state tuition in exchange for cranking up by $14 million state aid contained in the House budget.
The Senate higher aid is still lower than the amount Gov. Hassan included in her budget last February and at that time university administrators would not commit to her the tuition freeze in place the last two years would continue.
"We’re talking about a difference of $300 per student and they won’t commit to freezing tuition; that’s unacceptable to me,’’ Morse said.
Has anyone else noticed how quiet the Republican-led Executive Council has been in dealing with Democratic Gov. Maggie Hassan?
It’s a tribute to Hassan’s political skills; like Lynch before her, Hassan learned that succeeding with the council whatever the party in power is all about making sure there are no surprises and they are kept in the loop.
Many assumed Councilor David Wheeler, R-Milford, in particular would be a thorn in Hassan’s side from the get-go but their relationship has been better than just cordial.
Wheeler told NH1, however, he continues to have one beef. Wheeler believes some state agencies are breaking up contracts into smaller bites so they don’t have to come to the Executive Council for approval.
Last fall, the council raised the limit for contracts coming under its approval to $25,000.
"I’ve been gathering information about this and I’m going to raise it as an issue because it’s wrong for them to try and go under the radar like that,’’ Wheeler said.