Budget 2026-2027

Gov. Ayotte’s budget proposal

On February 13, Gov. Kelly Ayotte presented her budget proposal to the state Legislature. She highlighted several funding priorities, including:

• A nearly 50% increase in funding for special education
• Allowing all students currently enrolled in public school to participate in the Education Freedom Account program, which lets students spend the per-pupil share of public school funding on private or home school expenses
• Increasing state funding for the Community College System (by about $10 million)
• Funding the Northern Border Alliance and other law enforcement initiatives, including increased funding for retirement benefits

Her budget also includes policy changes, such as:

• Reversing the bail reform law passed last year and limiting the conditions for bail
• Requiring state agencies and departments to process permits related to housing within 60 days
• Placing a moratorium on new landfill permits
• Allowing charitable gaming locations to bring in slot machines, which would in turn increase state revenue from gambling

With falling business tax revenue, pending lawsuits against the state, and the loss of federal funds related to COVID-19, Gov. Ayotte also proposed several ways to cut state costs, such as:

• Decreasing state funding for the University System (by about $16.5 million)
• Adding co-pays for some Medicaid recipients
• Dipping into the state Rainy Day Fund

The House of Representatives budget proposal

The House of Representatives had much lower revenue estimates than Gov. Ayotte, and the House cut her budget proposal accordingly. Some of their most notable cuts include:

• Decreasing state funding for the University System by about $50 million
• Eliminating about 200 positions in the Department of Corrections
• Reducing Medicaid reimbursement rates by 3%
• Cutting funding for the state Council on the Arts, family planning, the Human Rights Commission, and the Office of the Child Advocate

The House also added several policy changes, including:

• Prohibiting any language related to diversity, equity, and inclusion in state contracts
• Adding an exception to state anti-discrimination laws for bathrooms, locker rooms, sports, prisons, hospitals, and treatment centers to classify individuals based on biological sex
• Removing the authority of the Department of Health and Human Services to require vaccinations beyond those in state law. Chickenpox, Hepatitis B, and Hib vaccination requirements would expire in 2026.

The House budget also legalizes slot machine gaming, like Gov. Ayotte's budget. The House budget also gradually expands Education Freedom Accounts so that all students are eligible, regardless of family income or whether or not they ever enrolled in public school.

The House voted down a hotly-debated provision that would have required a supermajority to increase local school budgets over a cap.

Next steps

The Senate is next to consider the state budget bills, HB 1 and HB 2. Citizens Count will update this page as the budget moves forward.