At NHFPI, we wish you all a Happy New Year! Wednesday, July 1, 2026 will mark the beginning of State Fiscal Year (SFY) 2027.
So, what does the new fiscal year mean for Granite Staters?
The Two-Year Budget Cycle
In New Hampshire, the State Budget spans two fiscal years, a period known as a “biennium.” Although a biennial budget is not typical for a state, it is not rare. New Hampshire is one of 19 states that creates budgets on a two-year schedule rather than annually.
New State Budgets take effect on July 1 of every odd-numbered year in New Hampshire. The process of creating those budgets begins in the preceding even-numbered years, usually during the summer, as State agency staff begin estimating needs and crunching numbers for the next State Budget biennium. The Governor’s office is required to be involved in the process by early August, and many legislators are already thinking ahead to the next State Budget throughout the summer.
As a result of this two-year budget cycle, the beginning of SFY 2027 will likely not result in many changes to State services. However, the new year marks the halfway point of the current State Budget, and next year’s new State Fiscal Year could result in much more substantial changes.
Current Revenues as the New Fiscal Year Looms
Based on State revenues for the fiscal year through May and early revenue reports from June, SFY 2026 will likely end with a revenue surplus for two key State Budget funds, the General Fund and the Education Trust Fund. A revenue surplus occurs when actual revenues for a given period exceed the amount projected when the State Budget for that period was created. Ending SFY 2026 with a revenue surplus would provide more resources that could be used for the new budget and funding services for SFYs 2028-2029.
Next Steps in the Budget Process
The first formal step in law for creating the SFYs 2028-2029 New Hampshire State Budget will require action from the Governor. On or before August 1 must provide estimated revenues available for each State agency budget for the SFYs 2028-2029 period.
Once agencies receive the Governor’s revenue estimates, they will project the amount of funding required to continue operating with existing services and to meet legal obligations. This “Efficiency Budget” request is constrained by those revenue estimates and cannot exceed them. Each agency will also create a separate budget for “Additional Prioritized Needs,” listing the funding they would require to enhance their services or better fulfill their legal obligations or objectives. The Governor can also require that State agencies include certain parameters in budget proposals or produce other variations on their State Budget requests. Both primary parts of the agency budget requests are due to the Governor’s office by October 1, 2026.
After receiving agencies’ budget requests, the Governor will begin to create the first draft of the new budget. The deadline for presenting the Governor’s budget proposal to the Legislature is February 15, 2027. Then, the Legislature’s work begins. In the most public phase of the State Budget, Representatives and Senators hear directly from Granite Staters through hearings and craft amendments to build their own versions of the State Budget. The House and Senate must pass an identical State Budget and obtain approval from the Governor before the current State Budget expires on July 1, 2027, to avoid an interruption in public services.
Impacts on Granite Staters
The State Budget is created through a long, complicated process that can be difficult for residents to track comprehensively. However, the State Budget impacts the lives of Granite Staters every day. State funding to schools and universities, local governments to help offset property taxes, public health programs, and assistance programs for food, child care, housing, and health care is determined in large part by policymakers’ choices when they are building the State Budget. Changes in those services can substantially affect the wellbeing of Granite Staters, including the availability and quality of services and how those services are paid for.