The Big Bad NH State Budget is in Peril
Clash of the Titans: Gov Ayotte vs. NH Senate President
Clash of the Titans: Kelly Ayotte vs. Senate President Sharon Carson
Drama unfolds at the New Hampshire State House as legislators prepare to vote on the state budget. Governor Ayotte has threatened to veto it unless it includes a clause to restore pension benefits to 1,500 first responders who saw these cut in 2011. (In Depth NH) She has allocated 27 million dollars for these benefits.
Senate President Sharon Carson vs. Gov Ayotte
The Senate President, Sharon Carson, opposes Ayotte’s fight to restore first responder benefits, stating that the state needs to recognize other interest groups first. Ayotte states that limiting these benefits would hinder recruitment and encourage early retirement for police and firefighters.
The drama escalated when Ayotte refused to support a final draft of the budget over the first responder details. She also opposes $51 million in cuts to Health and Human Services, citing concerns over the care of the state’s most vulnerable people. Another policy of contention is a cut to the Manchester Public School system of over $10 million dollars. Ayotte stated, “I will not negotiate, I will not compromise”, which served to throw a bucket of ice water at legislators hoping to meet in the middle.
Gov. Ayotte has threatened not to support a continuing resolution, which would allow the government to operate at current funding levels if no agreement is reached. Ayotte arranged a lunch for a group of senators, excluding the Senate President, Sharon Carson. She then approached the Executive Council to request a special legislative session to present her budget proposals, a move that bypassed Senate involvement and created more tension.
Key Budget Provisions
The controversial Education Voucher program removed income requirements, allowing any family, regardless of income, to apply. In the first week of enrollment, 2,000 new students applied, which means the program is already over budget. Ten thousand students can participate in the voucher program, but there is only funding to cover 7,500. It is difficult to understand why this legislation passed both houses, considering that the state entered budget negotiations with significantly less revenue than in past budget cycles. This is due to the cut in the interest and dividends tax (a reduction in revenue of 180 million) and the corporate tax rate, which is estimated to have reduced state revenue from 795 million to 1.17 billion, according to the NH Institute for Fiscal Policy.
The University System of New Hampshire was hit with a 20% cut, or $35 million. New Hampshire consistently ranks last in public funding of higher education, and this cut will ensure that the Granite State holds on to this great honor and will continue to lose young professionals seeking greener pastures in other states.
No new investments were made in the Affordable Housing Fund or Invest NH, which has significantly created new housing in our state. This means there will be more obstacles for local businesses facing a worker shortage, and young families will be discouraged from moving to Granite State.
One controversial policy was to increase the cost of medications for Medicaid enrollees from the current $1-2 dollars to $4. This provision will bring in just $1.5 million but could be a significant hardship for vulnerable citizens.
Back of the Budget, Out of Sight and Out Public View
The Senate made significant “Back of the Budget” cuts this year. These are cuts to agencies without specific line items, leaving the cuts to be determined by the state agencies themselves. The governor has charged that these deals were made in back rooms, with little transparency or citizen engagement.
The Department of Health and Human Services was hit the hardest, with a cut of $51 million
Funding was restored for developmental disability services under Medicaid, adding $62.8 million to the budget. These include services for meal preparation, personal care, and other essential services.
How will it all play out?
State legislators have packed their toothbrushes and pajamas, expecting a long debate about the budget on June 26th. They have been told there will probably be another session on Friday to vote on a Continuing Resolution, which would keep the government running if the budget doesn't pass.
There is some speculation that House Libertarians will side with the Democrats to oppose the presented budget. This could derail some of the closed-door deals that have been made out of public view. In any event, it’s time to buckle up and to prepare for a wild ride over the next two days.
Resources:
https://newhampshirebulletin.com/2025/06/19/ayotte-vows-budget-veto-unless-cuts-restored-putting-lawmakers-in-a-bind/
https://nhfpi.org/resource/the-senate-state-budget-proposal-for-fiscal-years-2026-and-2027/ (The Senate State Budget Proposal, NH Fiscal Policy Institute)