There's been some good news lately coming from the New Hampshire state government in regards to revenues coming in to the state coffers.
The Granite State ended the fiscal year on June 30 with about $19 million more than anticipated and tax receipts for this year's first quarter are almost $27 million ahead of projections, according to an Associated Press report. That's $37 million, or 9 percent, more than had come in during the first quarter last year.
Time to celebrate, right? Not so fast.
It wasn't too long ago that New Hampshire was facing revenue shortfalls in the hundreds of millions of dollars, and the governor and state legislators had to wrangle over budget cuts and tax increases to make up the difference. Those shortfalls of just a few years ago were blamed mainly on the economic recession plaguing the entire nation, while the current surpluses are being attributed to an economic recovery.
That just goes to show that much of what comes into the state in terms of revenue and business activity is strongly influenced by circumstances beyond the immediate control of state officials and political leaders. And with things on the national scene still so tenuous and unpredictable, now is hardly the time to take that surplus (which is quite small compared to the shortfalls of a few years ago) and act like a sailor on shore leave.
New Hampshire's Democratic political leaders want to use some of the unexpected surplus to restore budget cuts, particularly an unspecified $7 million in cuts made to social service programs. House Speaker Terie Norelli also wants to put some of the money into the state's depleted $9 million savings account, or rainy day fund.
"We've had a lot of rainy days," the Democrat told the AP.
House Republican Leader Gene Chandler said he's open to talking about using some of the money to restore spending cuts but would like to proceed cautiously. He rightly points out that whatever changes lawmakers make this year could affect spending levels in the next budget. And who knows what the revenue picture will look like a year from now.
Administrative Services Commissioner Linda Hodgdon points out that the $27 million in extra taxes received this year could be inflated by an increase in the tobacco tax that prompted businesses to buy tax stamps in advance of the increase taking effect, the AP reports. The $27 million figure could drop over time as businesses use the stockpiled tax stamps instead of buying new ones, she said.
We agree with Norelli that it would be good to restore some of the cuts made to programs that help New Hampshire's most vulnerable citizens who are still struggling through hard times, and we hope Democrats and Republicans come to the table with an open mind and a willingness to compromise (unlike the gridlock in Washington, D.C.). By the same token, however, we urge fiscal prudence in these still uncertain times.