Week Twenty-Two - June 19, 2009

This electronic publication, known as The Advocate, is brought to you each Friday by your Greater Nashua Chamber of Commerce, in partnership with our friends at Devine Millimet & Branch, and ActiveEdge. Please use this piece to review what has happened in Concord this past week, read about our Chamber's lobbying efforts relating to those activities, and preview what we are doing on behalf of our Chamber members in the coming week.

This Week’s Update

The House and Senate Committee of Conference on the state budget (HB 1 & HB 2) has finally come up with an agreed-upon state budget, at least for now. The Conference Committee’s agreed-upon budget now goes before the full House and Senate on Wednesday, June 24th, for a vote. There is much debate as to whether the budget will pass.

Before we get to the specifics of the budget proposal, let us set the stage for you. The Governor proposed his budget to the legislature on March 4th. The House Finance Committee spent the next 5 weeks hearing from commissioners, their staffs, and the public regarding the Governor’s budget. At the end of the day, the House Finance Committee presented an amended budget to the full House. The full House passed its version of the budget on April 8th.

The Senate Finance Committee began hearings on the House Budget on April 15th. Seven weeks later, the Senate passed their amended version of the budget. Beginning last week, on June 8th, the House and Senate conferees began meeting in order to reconcile the differences between the two versions. As we mentioned last week, the differences, particularly in revenue sources, were huge - gambling, capital gains tax, estates tax, insurance premium tax repeal, etc. In addition, even more ideas were being floated - a new refinancing of loans fee, an entertainment tax of 9%, etc.

Last week, the conference committee agreed on a lot of the easy issues. However, this week was different. All began very cordially on Monday, with both sides agreeing to close the Tobey School and Laconia State Prison. In fact, it stayed that way most of the week. Monday and Tuesday, no sparks flew. Wednesday, the big items came up and went down without much consternation:

Gambling - House said No
Capital Gains Tax - Senate said No
Legacy Tax - Senate said No
Insurance Premium Tax - Senate said No

Fortunately, both bodies agreed to remove the suspension of the BET credit against the BPT in 2011. THANK YOU COMMITTEE!

So What Was Agreed Upon:

• Revenue projections - an increase of $75 million;
• Cigarette Tax increase 45¢ per pack;
• Include snuff and smokeless tobacco within the tax on tobacco products. Increase tax from 19% to 49% of wholesale (premium cigars not included);
• Increase Rooms and Meals Tax to 9% and extend it to include campsites - $21 million;
• Raid the JUA (Joint Underwriting Association) medical malpractice fund by an additional $15 million. (a lawsuit was filed yesterday by medical groups to stop the State from seizing their money);
• Capturing the RETT on real estate holding companies – this netted the state $3 million;
• 10% state tax on gambling winnings, including non-profit bingo, etc.;
• LCHIP dedicated fund to be raided by 50% in 2011;
• Extending the Interest & Dividends tax to LLC’s – this netted the state $30 million;
• Sub-chapters “loophole” closed – this netted the state $11 million;
• $25 million in additional state layoffs and reductions in personnel expenses;
• $23 million in additional budget cuts, mainly in health & human services programs;
• New businesses will have to take out bonds to cover their rooms and meals tax payments upfront.

The committee finally agreed on a budget at 1:30 a.m. Friday morning. Your Chamber was still there covering every move or play! At press time, the actual printed language agreed upon has not been publicly released, so we will give you more information once we see the details, as we know the devil is always in the details!

This is not over. If the House or Senate vote the budget down, the late nights will start again…and your Chamber will be there!

Acknowledgements

This weekly update is made possible by the generous support of Devine Millimet & Branch, one of the state’s top law firms and our Chamber’s contracted representative in Concord. If your business has a legislative or local issue that needs strategic consulting and attention, they are a valuable resource that can help navigate you through both local and state processes.

This weekly update is designed and maintained by our friends at ActiveEdge, and we thank them for their help in delivering this piece to your inbox every Friday!

If you have questions about this update, or comments to share with us about other issues in Concord, please email Chris Williams at cwilliams@nashuachamber.com. We want to be sure we're representing you to the best of our ability, so do not hesitate to reach out to us!

J. Christopher Williams
President & CEO
Greater Nashua Chamber of Commerce
151 Main St.
Nashua, NH 03060
Phone: 603.881.8333
Fax: 603.881.7323