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More aid to cities and towns than ever before
by Senator Maggie Hassan (Democrat-Exeter)
States across the country are slashing budgets to cope with the worst national recession since the Great Depression. New Hampshire, like many other states, made difficult choices to adopt a responsible and balanced budget in these difficult economic times.
But one area where we continued to invest, rather than cut, was in state aid to cities, towns and schools.
The budget we passed makes cuts and changes to just about every area of state government. It reduces the state's workforce by at least 5 percent, closes district courts and the Laconia State Prison. It manages to fund essential services for our most vulnerable citizens through creative reorganization but puts off funding for other worthy programs until better times.
And let's be clear. We did not shortchange our local communities. In fact, in the aggregate, cities, towns and schools receive more direct state aid in this budget than in the last one. Overall, state general fund spending is down about 1 percent. State aid to communities, however, increases 1.7 percent in this budget.
More specifically, at a time when other states have decimated direct aid to local education, New Hampshire has lived up to its commitment to local school districts by substantially increasing education funding. In the next two years, we will send an additional $123 million in education aid to cities and towns - for a total of nearly $2 billion.
It's therefore grossly inaccurate for this editorial page or anyone else to say that the state has failed to live up to its commitment to local governments, or has shifted "the cost of state government onto the backs of local taxpayers" as Sunday's editorial in Fosters did. It is also an especially disappointing example of how difficult it can be to create new approaches to addressing our common needs and obligations in a time of crisis.
Overall aid to cities and towns has increased 1.7 percent. It is true that the state has suspended an arbitrary and outdated revenue sharing system, and reduced its contributions to the retirement costs of local employees. But the state has more than made up for these changes with an overall increase in local aid, including the $123 million in education aid.
The state revenue-sharing formula was devised before the state began spending a billion dollars a year on education. In fact, the revenue sharing concept was devised in part because the state was not contributing significantly to education. As it now stands, the revenue-sharing formula is not based on need and has been frozen for decades even as our population and demographics have shifted dramatically.
This budget also reduces the amount the state contributes to the retirement system for municipal employees. These are municipal, not state, employees, hired by the cities and towns with contracts and benefits negotiated by the cities and towns. The state has subsidized payments to the retirement system for these municipal employees for years. But at a time when we have made tough choices - and asked for sacrifice and creativity from every sector - it is also appropriate and necessary to ask local governments to do more to care for their own in this particular area.
Finally, local communities should recognize that their financial well being depends not only on the amount of direct state aid that they receive, but also on the continuation of many critical state functions preserved in this budget. Local families who receive state welfare payments (matched by the federal government) would have to turn to local property taxpayers for help if the state failed to fund the Aid to Needy Families program. Community hospitals will shut their doors without at least minimal provider payments from the state to help them care for the needy.
Difficult times call for difficult decisions and for all of us to learn how to function - constructively and together - to meet unprecedented challenges. This budget doesn't do things the way they've always been done - it can't and it shouldn't. But it does honor our commitments to keep our state safe and healthy, to educate our young people, to provide a modern infrastructure, and to protect our most vulnerable.
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