Budget 2024-2025

Gov. Sununu's budget proposal

Gov. Chris Sununu presented his budget proposal for the next two years on February 14, 2023. Here is a summary of that proposal.

Tax changes

Gov. Sununu's budget proposal kept current business tax rates and continued the gradual phase out of the Interest and Dividends Tax. The only major tax change he introduced was repealing the Communications Services Tax, a 7% tax on phone lines.

Education funding

Gov. Sununu proposed a new school funding formula that increases the base amount of per-pupil school funding from the state. He also proposed increasing the per-pupil state aid for low-income students. The plan would phase out other funding calculations, such as "stabilization grants" for schools with falling enrollment. 

Gov. Sununu also included expanded eligibility for Education Freedom Accounts (EFAs) in his budget proposal. EFAs allow students to take the per-pupil share of state education funding and spend it on private or home schooling expenses.

Expanding Medicaid

Gov. Sununu's budget supported a reauthorization of expanded Medicaid eligibility. That "Obamacare" program is scheduled to expire at the end of the year.

Additionally, health care providers would see higher reimbursement for Medicaid patients under Gov. Sununu's plan, at 3% across the board.

State employee pay raise

In his February 14th address, Gov. Sununu noted that 20% of state employee positions are unfilled. To help address the workforce shortage, the governor’s budget proposal included pay raises for state employees, 10% this year and 2% next year.

Addressing the housing shortage

Gov. Sununu’s proposal would send $30 million of the current budget surplus to InvestNH, a housing development fund the governor started last year. His proposal would send another $25 million of the surplus to the Affordable Housing Fund.

Sununu also proposed a new “historic housing preservation tax credit” for businesses that redevelop historic buildings as housing.

Occupational licensing reform

Gov. Sununu’s budget also proposed a reorganization of the Office of Professional Licensure and Certification (OPLC). As part of that reorganization, Gov. Sununu proposed “universal recognition of licensed professionals in other states.” This would allow people licensed in other states to have their license recognized in New Hampshire.

Click here to read the official Executive Summary of the governor’s budget proposal.

The budget passed by the House

The New Hampshire House of Representatives voted to amend Gov. Sununu's budget proposal and passed their version of the budget on April 6, 2023.

Tax changes

Rather than eliminate the Communications Services Tax, the House voted to speed up the elimination of the Interest and Dividends Tax.

Education funding

The House rejected Gov. Sununu's overhaul of the school funding system. Instead, the House budget targets funding towards poorer towns. The House budget also restructures how tax revenue funds public schools, putting more business tax revenue into the general fund of all tax dollars instead of the Education Trust Fund.

The House then stripped out Gov. Sununu's proposal to raise the income cap for families eligible for the Education Freedom Account program.

Expanding Medicaid

The House voted to reauthorize Medicaid expansion, but only for a few more years, rather than in perpetuity.

The House version of the budget also raises Medicaid reimbursement rates. Rather than 3% across the board, the House version of the budget greatly increases reimbursement rates for some providers, such as assisted-living facilities.

State employee pay raise, retirement

The House voted to keep the state employee pay raise as proposed by Gov. Sununu.

The House also voted to boost retirement benefits for roughly 1,800 fire and police employees who were working but not yet vested in the state retirement system in 2012, the time of a major retirement overhaul.

Addressing the housing shortage

The House revised the governor's plan for housing, sending $30 million to the Affordable Housing Fund and $15 million to the InvestNH housing development fund.

Occupational licensing reform

The House rejected Gov. Sununu's plans for occupational licensing reform, although some bills outside the budget process are moving forward parts of Gov. Sununu's plan.

Other major changes in the House budget

The House added a $23.4 million "back of the budget" cut to the Department of Health and Human Services, which requires the department to find those savings over two years.

The House also voted to strip funding for additional law enforcement along New Hampshire's border with Canada, and to require 24-hour notice before law enforcement sets up an immigration checkpoint.

Lastly, the House voted to limit the governor's powers to declare a state of emergency. Each state of emergency would be limited to 21 days, and the governor could only renew the state of emergency three times, for a total of 84 days.

The budget passed by the Senate

The New Hampshire Senate voted to amend the House budget proposal and passed their version of the budget on June 7, 2023. 

Education funding

The Senate voted to increase education funding using a different strategy than the House. Their formula is closer to Gov. Sununu's original proposal.

The Senate also rejected additional eligibility for free and reduced price lunches. They removed a program approved in the House that would automatically enroll students in the lunch program based on Medicaid eligibility.

Expanding Medicaid

House and Senate leaders have agreed to a compromise that reauthorizes expanded Medicaid eligibility for seven years. The Senate increased Medicaid reimbursement rates similarly to the House.

State employee pay raise, retirement

The Senate voted to keep the state employee pay raise as supported by the House and Gov. Sununu.

However, the Senate voted to remove a House budget provision that boosted retirement benefits for roughly 1,800 fire and police employees who were working but not yet vested in the state retirement system in 2012, the time of a major retirement overhaul.

Addressing the housing shortage

The Senate tweaked the budget funding for housing. The Senate budget sends $25 million to the Affordable Housing Fund and $10 million to the InvestNH housing development fund. In addition, the state Bureau of Economic Affairs will oversee a new $5 million grant for communities that earn the designation of "Housing Champion."

Occupational licensing reform

The Senate followed the House and did not include occupational licensing reform in its version of the budget.

Other major changes in the Senate budget

The Senate voted to reinstate funding for additional law enforcement along New Hampshire's border with Canada, after the House stripped it from the governor's budget proposal.

The House and Senate reached a compromise on public notice before law enforcement sets up an immigration checkpoint; law enforcement must post notice on their website, but do not have to share the notice with the press or social media.

Lastly, the Senate tweaked the House plan to limit the governor's powers to declare a state of emergency. Each state of emergency would be limited to 28 days, rather than 21 as proposed by the House.

A historic compromise

On June 8, 2023 the House agreed to the Senate version of the budget without any further changes or negotiation - a major departure from contentious budget debates of the past two decades. Gov. Sununu has since signed it into law.