The Senate Finance Committee voted on Tuesday, June 3, to adopt final versions of its amendments to the House’s version of the State Budget. The House passed its expenditure proposal for the next two fiscal years on April 10, and the Senate is due to vote on its proposal on Thursday, June 5. The Senate Finance Committee’s proposal would spend more than the House’s recommendations, but less than the budget put forward by the Governor in February.

While the Senate Finance Committee’s version may have further amendments on the floor of the Senate, the Committee has done most of the work that the chamber will do on its budget proposal.

These amendments by the Senate Finance Committee do not eliminate the House’s positions from the entire process. Those positions are still in the House version of the State Budget and likely will be considered in the upcoming Committee of Conference.

The Committee made more than 200 individual funding and policy changes in crafting its amendments to the House-proposed budget. The largest of these individual changes included increased funding for Medicaid services relative to the House’s reductions, more money for the Youth Development Center settlement fund and for the University System of New Hampshire, adding back in funding for developmental services and mental health services that the House had reduced, and increased funding at the Department of Corrections from the House’s proposed cuts, but still lower than the Governor’s recommended amount. The largest funding decreases relative to the House’s proposal would be in special education funding for local public schools, retirement support for certain police and firefighting personnel, and a larger back-of-budget reduction for the Department of Health and Human Services.

These changes were distributed among the six categories of State Budget expenditures that organize State agency activities. The six expenditure categories, in the order of the financial magnitude of the changes, include Health and Social Services, Justice and Public Protection, Education, Resource Protection and Development, General Government, and Transportation.

The Health and Social Services category in the State Budget is the largest expenditure category and is comprised almost entirely of the Department of Health and Human Services (DHHS). Under the Senate Finance Committee’s proposal, funding increases supported several restored services compared to the House budget, as well as several newly established programs.

Medicaid

Within the DHHS’s Budget, the largest monetary change proposed by the Committee included the repeal of the House’s proposed three percent Medicaid rate reduction, restoring $52.5 million in General Funds for the biennium and at least equal amounts in federal funding to account for federal Medicaid match dollars.

The Committee proposed changes to Medicaid premiums for the Granite Advantage Health Care Program and Children’s Health Insurance Program (CHIP) that were established in the Governor’s proposal and carried forward by the House. Under these changes, both Granite Advantage and CHIP premiums would be determined based on fixed dollar amounts depending on household size, rather than a percentage of income as introduced in past proposals. The Committee estimates that $5 million will be collected through Granite Advantage premiums during State Fiscal Year (SFY) 2027, $7 million less than the $12 million estimated by the Governor and House.

The Committee reinstated the use of Liquor Funds to support the Granite Advantage Health Care Trust in the event of any funding shortfalls, while removing the allowance of General Fund support for the Program added in the House’s proposal.

The Committee added two Senate Bills to its State Budget proposal regarding the State’s Medicaid program. The first, Senate Bill 134, requires the DHHS to resubmit a federal Medicaid waiver to institute work requirements already outlined in state statute; this amendment would require adults in the Granite Advantage program to work or participate in an eligible community engagement activity at least 100 hours per month. The Committee also added Senate Bill 135, which requires the DHHS to annually set cost-reflective rate parity for Medicaid managed care services and allocate $2.3 million during SFY 2027 to establish those payment rates.

While there were no identified changes in funding for services, the Committee approved the movement of funds between budget lines to reflect the approved agreement between hospitals and the State around the Medicaid Enhancement Tax (MET) and the portion of funds that hospitals receive back in the form of Disproportionate Share Hospital (DSH) Payments to support uncompensated care.

Finally, the Committee allocated $3.8 million in General Funds to the Division of Economic Stability to fund a tier-one call center to process Medicaid eligibility determinations.

Services for Older Adults and People with Disabilities

Another significant monetary change proposed by the Senate Finance Committee included restoring funding for developmental disability Medicaid waiver services to the Governor’s proposed amount, adding $62.8 million in combined federal and General Funds to help ensure there is no waitlist for services.

The Committee added the carryforward of $10 million in unspent funds during the current SFY 2025 to support funding for community-based residential services for those with disabilities.

In addition, the Committee allocated $3 million to support faster turnarounds for Medicaid long-term care eligibility determinations. It temporarily increased annual nursing home licensing fees for the upcoming biennium only to help support this added allocation.

The Committee restored funding for services and added several new initiatives to support Granite Staters with disabilities and older adults. These included:

• $700,000 to fund congregate housing;
• $550,000 to establish 50 guardianship slots for individuals released from hospital settings who are legally incapacitated and require help making decisions around hospital discharge;
• $211,718 to institute two percent rate increases each year of the upcoming biennium to support intermediate care for children with disabilities; and
• $200,000 to increase funding for the Alzheimer’s Disease and Related Dementias (ADRD) caregiver grant program.

Finally, the Committee established a committee to study the potential integration of Medicaid-funded long-term care into the managed care system, with a report required to be submitted by the committee by October 1, 2025.

Mental Health and Substance Use Disorder Services

Included in its budget proposal, the Senate Finance Committee added $37.8 million in funding for the community mental health system, restoring allocations to the amount proposed by the Governor. These allocations would help support non-Medicaid contracts within community mental health services, as well as add back $10 million to support uncompensated care as proposed by the Governor.

The Committee also reinstated the annual five percent transfer of dollars from the Liquor Fund to support the Governor’s Commission on Alcohol and Other Drugs, adding $21.4 million in General Funds across the biennium.

The Committee included Senate Bill 255 in its State Budget proposal, establishing a 988 Trust Fund to collect telecommunication surcharges to support the hotline, with an estimated $15 million in surcharge revenue to be collected across the upcoming biennium. The 988 Trust Fund would be overseen by the Behavioral Health Crisis Services Advisory Commission, with funding available to support staffing and training at call centers, infrastructure adjustments for the call center system, and data reporting across services, among other 988 supports.

The Committee also added Senate Bill 128, establishing a Children’s Behavioral Health Association to coordinate mental health services for children under age 19 who are not covered through Medicaid. This Association would be funded through annual assessments collected from private insurers, generating an estimated $5 million in assessment revenue during the upcoming biennium.

Finally, the Committee restored funding for two behavioral health-related programs that were eliminated under the House’s proposal. These include full funding of $400,000 for the Friends of Aine peer grief support program and partial funding of $300,000 for the Choose Love Program, which provides socio-emotional learning for youth in schools across the state.

Child Wellness and Maternal Mental Health

The Senate Finance Committee’s budget proposal reinstates the Office of the Child Advocate and restores approximately $1.6M in funding for the office. The restored funds would result in four positions being abolished, rather than nine, compared to the House’s version of the budget. Language was added that would affect the functioning of the Office, including:

• Language clarifying that there should be non-partisanship in oversight duties
• A nomination process that involves a nomination by the Governor and approval by the Executive Council (versus a gubernatorial appointment)
• Requiring approval for out-of-state travel by the Joint Legislative Fiscal Committee, except that which is required to ensure children are receiving appropriate services

Senate Bill 246, or “Momnibus 2.0,” was added to the Senate Finance Committee’s proposed State Budget to help address needs resulting from the closure of labor and delivery units across the state and create necessary perinatal mental health supports for Granite State women. This maternal health package includes allocations of $150,000 for rural maternal health EMS training and $30,000 to support a study on reducing barriers and examining sustainability for independent birth centers. Additionally, insurance can opt to waive copays for mental health and substance use treatment for perinatal patients. The perinatal care and supports portion of this package also requires:

• Depression screens during well-child visits for pregnant or postpartum patients to be covered by private insurance and Medicaid
• Home visiting services during pregnancy and up to 12 months postpartum to be covered by commercial insurance plans
• The creation of a perinatal psychiatric provider consult line in statute starting SFY 2028
• DHHS to examine the development of a perinatal peer support certification program
• Employee protection for unpaid time off to attend up to 25 hours of postpartum care and pediatric appointments during the infant’s first year of life for employers with 20 or more employees

The Committee also recommended the development of an Adverse Childhood Experiences (ACEs) Prevention and Treatment Program. ACEs can include physical, emotional, or sexual abuse, neglect, witnessing violence, experiencing homelessness, food insecurity and household instability. Over the biennium, the Committee proposed $300,000 to support children through age six who have experienced ACEs or other “severe emotional disturbances” through:

• Increases in Medicaid reimbursement for early childhood mental health care
• Increased salary levels or reimbursement rates for individuals with an early childhood and family mental health credential
• Funding for training and professional development in early childhood mental health care
• Creation of a five-year plan by DHHS to increase state workforce capacity

Public Health Services

The Senate Finance Committee restored partial funding for the Family Planning Program, which provides low- to no-cost preventive and reproductive health care at health centers across the state. The Committee’s allocated $1.0 million in General Funds were $700,000 less than the $1.7 million proposed by the Governor, although all related federal funding ($2.0 million) for the program would be restored.

The Committee made two key changes for the State Loan Repayment Program (SLRP), which helps to recruit and retain health professionals to commit to working in rural or medically underserved areas in New Hampshire. The Committee’s proposal reverses the House’s proposal by allowing new participants to enter into the program during the upcoming biennium as long as General Funds are not used to support those new applicants. In regard to the SLRP, the Committee also added a component of Senate Bill 244, adding $500,000 across the biennium to support a newly established Family Medicine Residency Program in the state’s North Country.

Finally, while General Funds were not restored, the Committee allocated $1 towards the Tobacco Prevention and Cessation Program to maintain the program’s statutory status in case funds become available at a later date.

Other Health-Related Services

The Senate Finance Committee proposed two key changes around services for Granite Staters experiencing food insecurity, including a $30,000 allocation towards the WIC Farmer’s Market Nutrition Program, which was previously defunded by the House, as well as $105,000 to support two positions to administer the newly established Summer Electronic Benefits Transfer (EBT) Program.

While they did not increase funding, the Committee approved the movement of $5 million from SFY 2027 to SFY 2026 to support youth residential placements, following a ten percent reduction for these placements as proposed by the House.

Finally, the Committee repealed the Prescription Drug Affordability Board in its entirety, and also retained the House’s position to eliminate all funds for the Board.

The Senate Finance Committee’s budget proposal includes a significant increase in funding for the University System of New Hampshire relative to the House’s version of the State Budget. The Committee also proposed curtailing a House-proposed change to the education funding formula that would have increased funding to school districts with more pupils with special education needs, as well as added requirements for obtaining permission for certain uses of federal funds for child care workforce supports.

Early Childhood Care and Education

The Senate Finance Committee’s budget proposal modifies language from Senate Bill 243 to help remedy several challenges related to the New Hampshire Child Care Scholarship Program (NHCCSP), the state-federal partnership that provides subsidies to assist with child care for families with low and moderate incomes. The Committee allocated $100,000 to support a study on the child care scholarship application process, examining ways to simplify and improve the application process for families. The funding allocation is also intended to help address the following changes to the program:

• Removing requirements for providers to report hourly attendance
• Provide scholarship payments to providers before the start of the care period
• A presumptive eligibility two-year pilot program that would allow families to enroll in child care with a scholarship while their applications are still being processed by the State

The Committee kept a $15 million biennium allocation in the State Budget for child care workforce grants that would be entirely funded through federal Temporary Assistance for Needy Families (TANF) reserve funding. These grants were established during the current budget cycle to support child care providers in recruiting and retaining a robust early care and education workforce, which is currently in short supply. The Committee added language that would require the New Hampshire DHHS to seek approval from the federal Department of Health and Human Services to use the federal TANF reserve funds for this purpose by August 1, 2025, and if necessary, complete any required waivers to utilize the funds for the child care workforce grants.

K-12 Education

The Senate Finance Committee’s budget proposed an adjustment to the House’s version of the adequate education grants. While the Committee kept the base per student grant ($4,351) and the differential aid adjustments for students eligible for free and reduced-price meals ($2,441) and those who are English language learners ($849), the Committee reduced the amount for students receiving special education services by approximately $900 dollars by reverting to current policy, likely reflecting the continued 2 percent per year increase ($2,229).

The Committee also added nearly $7.6 million in anticipated federal grant funding from various sources including Safe and Supportive Schools, State Opioid Response, and Team Nutrition Training. Additionally, $3.0 million was appropriated from the Education Trust Fund over the biennium toward “…a learning platform that provides high-quality instructional materials across all content areas to ensure all K-12 students [in New Hampshire] have access to evidence-based and content-rich learning outcomes.” The Committee also amended the State Budget to provide additional state funding for adult education programs for certain students for $800,000 over the biennium.

The Committee recommended universal eligibility for Education Freedom Accounts (EFAs) beginning in SFY 2026 (academic year 2025-2026) and reduced the allocation for EFAs by $3.9 million based on anticipated participation in the program. The Committee changed State Budget policy language to reflect that “priority guidelines students” would not be subjected to the enrollment cap, which will be 10,000 students for the 2025-2026 academic year. Priority guideline students include:

• Students currently enrolled in an EFA program
• Siblings of students currently enrolled in an EFA program
• A child experiencing a disability
• Students whose families have incomes less than or equal to 350 percent of the Federal Poverty Guideline

Public Higher Education

The Committee recommended allocating $85 million each fiscal year to the University System of New Hampshire (USNH), which is an increase of approximately $67.5 million in General Funds across the biennium from the House’s proposed budget, and $37.5 million when accounting for UNIQUE funds that the House proposed adding to the UNHS budget.

With the restoration of some General Funds back to USNH, the Committee recommended removing a $30 million allocation of UNIQUE grant funds to USNH. The UNIQUE grant program provides financial support to college students from families with low incomes to help subsidize their education. These grants can typically be used by any college student in the state, not just students attending institutions of higher education through USNH or the Community College System of New Hampshire. The Committee recommended moving $12 million of UNIQUE funds to the General Fund and restoring the remaining $18 million to UNIQUE grants over the biennium.

Other Education Policies

The Senate Finance Committee also proposed a language change regarding diversity, equity, and inclusion (DEI) prohibitions in public schools, including K-12, academic institutions, and institutions of higher education. The Committee recommended replacing “…race, sex, ethnicity, or other group characteristics…” in the definition of DEI with “…characteristics identified under RSA 354-A:1…” Characteristics identified under RSA 354-A:1 include, “age, sex, gender identity, creed, color, marital status, familial status, physical or mental disability…national origin…[or] sexual orientation.” Schools and institutions that do not comply with the prohibition may lose access to public funding until the violation is resolved.

Municipalities are also included in this amendment. However, the legislation does not suggest towns and cities would lose access to any funding if they do not comply with the DEI prohibition.

Relative to the House’s budget proposal, the Senate Finance Committee reduced the amount taken out of the Governor’s budget proposal for the Department of Corrections, added funding for legal settlements related to the Youth Development Center, increased funding for the Judicial Branch and the Department of Justice, and restored the Human Rights Commission.

Department of Corrections Positions

While the House would reduce funding for positions at the Department of Corrections by $35.3 million relative to the Governor’s proposal, the Senate Finance Committee reduced that total cut to about $17.8 million, proposing the elimination of 60 positions. The Committee reinstated positions in various operations, including mental health services within the Department. Four mental health services positions were restored but unfunded, allowing the Department to allocate resources across existing positions in response to needs, rather than re-establishing those positions before they could be filled. The Committee added a $5.0 million back-of-budget reduction to the Department of Corrections.

Youth Development Center Settlements

The House’s budget proposal would devote $10 million each year of the biennium to the Youth Development Center Claims Administration and Settlement Fund. The Senate Finance Committee voted to retain that amount, but shift the full amount to the first year of the biennium. The Committee also planned for the sale of the Sununu Youth Services Center building to generate $80 million in SFY 2027, and proposed depositing that total into the Fund.

The Committee also proposed shifting the Fund’s administration and oversight from the Judicial Branch to the Executive Branch, putting it under the purview of the Governor.

Human Rights Commission

The Committee voted to continue the Human Rights Commission, which the House proposed eliminating. The Committee included a $521,000 back-of-budget reduction in the Human Rights Commission’s budget, however, and established a one-year advisory committee to be attached to the Human Rights Commission.

Liquor Commission Law Enforcement Authority

While the House proposed removing law enforcement authority from the Liquor Commission, the Senate Finance Committee proposed retaining that authority with the Commission. Senators restored funding for the law enforcement positions, but also added a back-of-budget reduction of $2 million to the Liquor Commission.

Liquor Commission funds would continue to be used as a backstop for the non-federal share of Medicaid Expansion, also known as the Granite Advantage Health Care Program, and for contributions to the renamed Governor’s Commission on Addiction Treatment and Prevention.

Other Funding Boosts and Restrictions on Land Sales

A Senate policy proposal attached to the Senate Finance Committee’s version of the State Budget would add requirements for people newly purchasing or renting properties within ten miles of certain locations within the state. People purchasing or renting within this radius of these “protected sites,” including locations in Manchester, Portsmouth, Concord, and New Boston, would have to verify with the State government that they are not representatives of, or otherwise under the control of, the governments of China, Iran, North Korea, Russia, or Syria.

Funding for other law enforcement and justice activities would also be boosted by the Senate Finance Committee relative to the House version of the State Budget, including:

• Eliminating the proposed back-of-budget reductions for the Judicial Branch and the Department of Justice
• Adding a total of $5.2 million in funding to the Judicial Branch for reimbursements to Sheriff’s offices, court security, and management of Youth Development Center cases
• Boosting funding for the public defender program by $3.8 million
• Restoring $650,000 in funding for the Goffstown and Hooksett courts, which would likely close under the House’s version of the State Budget
• Making a $600,000 appropriation to the Northern Border Alliance
• Adding $400,000 for legal counsel supports for people with involuntary mental health admissions

Several Department of Safety policies related to motor vehicles were added and are discussed in the Transportation section below.

The Transportation expenditure category in the State Budget is entirely comprised of the New Hampshire Department of Transportation (DOT) budget and does not include any other departments or agencies. In the Senate Finance Committee’s version of the budget, $3.5 million dollars over the biennium was moved from winter maintenance to the winter retention initiative intended to recruit and retain plow truck drivers to reduce the need for overtime or use of contracted plow drivers. The Committee proposed reducing several registration fees for heavy vehicles compared to the House’s version of the budget, resulting in a reduction of approximately $13.0 million in the Highway Fund and $540,000 in the Highway Fund block grants to municipalities over the biennium.

The Committee also added policy language from House Bill 133 that would require nonresident drivers who establish residency in the State to contact the Department of Safety if they do not formally become residents within 60 days or if their driver’s license from another state expires. The bill also requires that the Division of Motor Vehicles send violation notices to these individuals.

Inspections and License Plates

With regard to motor vehicle policies that are under the Department of Safety, the Committee recommended that vehicle safety inspection failures be limited to safety-related features, including malfunctioning brakes, horns, or lights, or rust resulting in structural deficits. Emissions testing would no longer be required, under the Committee’s proposal, provided the Department of Environmental Services is granted a waiver to excuse New Hampshire from federal emissions requirements. New cars would not require inspections for three years after purchase, but after three years, they would require annual inspections. The Committee’s changes to vehicle safety inspections would result in an increase of $105,336 to the General Fund from inspection fees paid to the state and the restoration of eight inspection-related employee positions.

The Committee also proposed that the manufacturing of license plates be transferred from the Department of Corrections to the Department of Safety, that the manufacturing fee be increased from $4.00 to $6.00 per plate, and that the embossing requirements be removed. These changes are estimated to generate $1.8 million for the Reflectorized Plate Fund over the biennium.

Resource Protection and Development and Energy Policies

Changes made by the Senate Finance Committee primarily reflected energy and waste policies differences and changes to funding for the arts and water policies. While the Department of Energy is formally categorized under Justice and Public Protection, the changes to its energy policies could have significant environmental and economic impacts.

Solid Waste

The Senate Finance Committee recommended modifying the Solid Waste Management Fund from the House version to make payments to municipalities for source waste reduction and recycling efforts on a quarterly basis, rather than annually. The fine for failure to pay into the Fund would also drop from $25,000 per day of violation to $1,000 per day.

The Senate Finance Committee also recommended changes to the proposed Solid Waste Site Evaluation Committee. The new Committee would focus on the impacts of new landfills beyond the scope of the current reviews under the Department of Environmental Services, rather than both repeating that scope and including the broader economic and other impacts of new landfill sites as the House proposed.

Energy Policy and Funding Changes

Under the Governor’s version of the State Budget, $10 million would be transferred from the Renewable Energy Fund into the General Fund to support overall State operations. The House proposed emptying the entire Renewable Energy Fund, after paying for certain administrative costs, into the General Fund for the biennium and restricting the use of Renewable Energy Fund dollars in future biennia to lowering per kilowatt-hour electric rates. The Senate Finance Committee proposed retaining $2 million in the Renewable Energy Fund to support ongoing projects, although it would not provide funding for residential solar. The Committee would also not change the uses of the fund after this biennium is over, which is a modification of the House’s proposal.

The Senate Finance Committee removed the alterations to the Renewable Portfolio Standard that the House proposed that would have removed the solar energy requirement from the Renewable Portfolio Standard. The Senate Finance Committee also voted to remove the House’s proposed State energy policy that would focus on market mechanisms and trends to guide energy policy.

Water

The Senate Finance Committee’s budget would require that $11.55 million be withdrawn from the Drinking Water and Groundwater Trust Fund for regional water infrastructure construction in towns in southern New Hampshire in SFY 2026. These funds would be used to support communities with groundwater impacted by Perfluoroalkyl and Polyfluoroalkyl Substances (PFAS). Language attached to the Senate Finance Committee’s version of the State Budget would also require the creation of an application and approval process for PFAS-related funding for public water systems affected by the chemicals.

The Senate Finance Committee voted to support $5 million in State aid to local governments to fund wastewater infrastructure projects. The Committee proposal also includes $325,000 for the Pillsbury Lake Village District.

Arts Funding

The Department of Natural and Cultural Resources’ Division of the Arts would remain in statute under the Senate Finance Committee’s budget proposal, while the House would have repealed this Division. The Senate added $300,000 in direct funding, which is lower than the Governor proposed, and added a credit against the two State business taxes that could generate up to $700,000 more revenue for the Division of the Arts if businesses use the credit. The assumption made by the Senate Finance Committee was that this level of funding would be sufficient to access federal matching funds.

General Government

Some of the most significant policy and funding changes in the General Government category were for public employee retirement funding, revenue sharing with municipalities, and the removal of an array of policies attached to the House version of the State Budget.

Retirement Contributions for Certain Police and Firefighting Personnel

The Governor and the House both proposed boosting retirement benefits for certain police and firefighting personnel who had their anticipated retirement benefits altered after a 2011 law change and who were not vested in the retirement system by 2013. The House proposed a larger amount of funding than the Governor, supporting these benefits with a full $27.5 million in funds for each fiscal year from SFYs 2026 through 2034.

The Senate Finance Committee voted to delay implementation of the House’s policies by six months, which would reduce expenditures relative to the House by $13 million during the biennium.

Housing

The Senate Finance Committee reinstated the Housing Appeals Board, housing it under the reinstated Board of Tax and Land Appeals. While the Committee restored both, each Board received a slight funding reduction to account for staffing and position changes. $365,922 was allocated to the Housing Appeals Board, while the Board of Tax and Land Appeals was funded at $2.1 million for the biennium.

In addition to a reduction in funding, the Committee also proposed administrative changes to the Boards’ decision-making processes. Under the new structure, members from opposite Boards can make decisions and serve as tiebreakers if a consensus cannot be reached.

The Board of Tax and Land Appeals would also increase its filing fees, from $65 to $125, during the upcoming biennium.

While it did not allocate new funds, the Committee extended lapsing funds for the Housing Champions Program, which was established in the current SFYs 2024-2025 budget and provides grants to municipalities to encourage zoning law changes to support the construction of new affordable housing.

State Commission on Aging

The House voted to eliminate the State Commission on Aging. Under the Senate Finance Committee’s version of the State Budget, the State Commission on Aging would continue with a flexible fund of $300,000, which would support compensation for the Executive Director and the Commission’s activities. The appropriation decisions were made after considering whether to make the Executive Director a part-time or full-time employee, and the final language does not specify.

The State Commission on Aging would also have terms for membership extended from two years to three years, and an attached advisory council focused on the system of care for older adults in the state.

Municipal Aid Funding

The Senate Finance Committee voted to continue the current policy of devoting 30 percent of State Meals and Rentals Tax revenue to municipal aid, provided on a per capita basis. The House had voted to set the funding level at $137 million per year, which is slightly higher than the current year’s funding level.

The House also voted to repeal a statute, suspended since 2010, for a separate municipal revenue sharing formula. The Senate Finance Committee would continue the suspension of the statute, rather than repeal it.

House Policies Removed

The House version of the State Budget would have included a wide array of policies, many of which were removed in the proposal from the Senate Finance Committee. These policies continue to exist in both the House version of the State Budget and, in several instances, in separate bills that have already been signed into law in a different form. Policies removed by the Senate Finance Committee include, but are not limited to:

• Open enrollment for school districts
• Permitting restrictions on bathroom use and sports activities based on biological sex
• Restricting Medicaid coverage for circumcisions
• Limiting vaccination rulemaking authority and sunsetting certain vaccine requirements
• Permitting a renter’s lease termination to be considered sufficient reason for eviction
• Repeal of required outreach for the Granite State Paid Family Leave Plan
• Changes to residential care and health facility licensing
• Policies restricting cell phone use in schools
• Increased penalties for knowingly reporting false claims of child abuse
• Restrictions on public officials’ electioneering
• Required increases in voter checklist verification frequency
• Policies permitting adults to have blackjacks, slung shots, or metallic knuckles
• A legal framework for producing and selling firearms in-state only

The Senate Finance Committee proposed increasing revenue projections under current policy relative to the Senate Ways and Means Committee’s projections. The boosts were across six revenue sources:

• The two primary State business taxes combined ($75 million increase during the biennium)
• The Meals and Rentals Tax ($27.8 million)
• Historic horse racing overseen by the Lottery Commission ($8.8 million)
• The Real Estate Transfer Tax ($5 million)
• Recoveries from the Medicaid program ($200,000)

The Senate Finance Committee also voted to project $80 million from the sale of the Sununu Youth Services Center.

Lottery

The Senate Finance Committee would boost revenues relative to current policy by expanding gambling in New Hampshire. The Committee proposed changing the official name of the New Hampshire State Lottery Commission to the New Hampshire State Lottery and Gaming Commission. The Committee, with a different set of proposed policies than the House, adjusted anticipated Video Lottery Terminal (VLT) revenues to $83.5 million over the biennium, and changed the tax rate for VLTs to 31.25 percent. The Committee proposed allocating the revised VLT revenues as follows:

• Approximately $61.9 million to the General Fund
• Over $20.6 million to the Education Trust Fund
• About $1.0 million to the Governor’s Commission on Addiction Treatment and Prevention

The Committee also increased estimated revenues for historic horse racing machines compared to the amounts approved in the Senate Ways and Means Committee. This estimate revision would result in over $8.7 million in additional dollars for the Education Trust Fund over the biennium.

The Committee recommended changes to current lottery rules including

• Approval of high-stakes tournaments defined as buy-ins of $2,500 or more
• Removal of maximum wager cap (previously $50)
• Expanded hours for Keno to match the hours of a business’s operations
• Requiring municipalities to vote to prohibit Keno gaming rather than voting to adopt it

The Committee also created an Elderly, Disabled, Blind, and Deaf Exemption Reimbursement Fund which would reimburse municipalities for tax exemptions beginning in SFY 2028 and be funded by VLT revenues. Additionally, the Committee proposed eliminating the Council for Responsible Gaming and transferring its work to the Division of Behavioral Health, which would result in a $500,000 increase in General Funds.

Other Revenue Policy Changes

The Senate Finance Committee voted to institute a tax amnesty program to collect revenue from individuals and businesses with outstanding and unpaid taxes from prior years, projecting that this program would generate approximately $4.0 million in net revenue.

The Committee also voted to add more auditors to the Department of Revenue Administration’s staff, anticipating approximately $5.0 million in net revenue from those additions.

The Committee’s recommendation would increase State fees, including for the Board of Tax and Land Appeals, cremation certificates, the Office of the Chief Medical Examiner, vehicle license plates, and licenses for hospitals, nursing facilities, home health providers, laboratories, and other health-related facilities.

Finally, the Committee also voted to maintain the current purposes for which funding from the Education Trust Fund could be used and to adjust the split in shared revenue sources between the General Fund and the Education Trust Fund. The uses of the Education Trust Fund would have been expanded under the Governor’s proposal, and restricted relative to current policy under the House’s budget proposal. The Senate Finance Committee would permit the funds to be used for:

• The Adequate Education Aid payments as defined by the State’s education funding formula
• School Building Aid
• Public School Infrastructure Fund
• Court-ordered placements
• Tuition and Transportation Aid
• State testing
• Building Lease Aid
• Special Education Aid

The House proposed that 30 percent of revenue from the two primary business taxes, the Tobacco Tax, and the Real Estate Transfer Tax flow to the Education Trust Fund. The Senate Finance Committee would set that percentage to 35.5 percent, and leave a positive balance of $19.2 million in the Education Trust Fund at the end of the biennium.

Back of Budget Reductions

The House proposed a total of $95.5 million in back-of-budget reductions among State agencies. These reductions would require certain agencies to find savings in their budgets without identifying specific line items, but by lowering their overall expenditures compared to their topline totals.

Senate Finance Committee’s proposed budget would modify these back-of-budget reductions. Back-of-budget reductions would be increased for:

• Statewide savings or revenue that would be identified by the Governor across the State government, generating $32.0 million in revenue or savings, repealing and replacing the House’s proposed 5 percent fee on dedicated funds
• The Department of Health and Human Services back-of-budget increases by $5.0 million, to a total of $51.0 million
• New for the Department of Corrections ($5.0 million)
• New for the Liquor Commission ($2.0 million)
• New for the Human Rights Commission ($521,000)

The Senate Finance Committee eliminated or altered back-of-budget reductions for:

• The Department of Justice ($14.7 million in the House version)
• The New Hampshire Retirement System ($8.7 million in the House version)
• The Judicial Branch ($7.9 million in the House version)
• Added flexibility for the Department of Information Technology, but the reduction amount stays the same

Policy language also grants the Governor the authority to add funding for operations, if General Fund revenues are sufficient, with approval from the Joint Legislative Fiscal Committee.

The Rainy Day Fund

The Senate Finance Committee’s proposal would withdraw a projected $93.4 million from the Rainy Day Fund to balance the current year’s State Budget. Still, it would add a projected $50.4 million in otherwise unspent General Funds back to the Rainy Day Fund at the end of the biennium on June 30, 2027. The total Rainy Day Fund balance would be a projected $249.5 million at the end of the biennium. That total would be higher than either the Governor’s ($222.0 million) or House’s ($228.8 million) projected ending balance, but lower than the current balance of $292.5 million.

The full Senate will consider the Senate Finance Committee’s amendments to the State Budget, and any other amendments brought forward, on Thursday, June 5. If the House requests a Committee of Conference to resolve policy disagreements, the Committee will be formed by June 12 and must complete its work by June 19. The version of the State Budget produced by the Committee of Conference will receive an up-or-down vote on the floors of both the House and the Senate, without any opportunities for amendments. If it passes both chambers on June 26, when the votes are scheduled, it will go to the Governor’s desk.

Authority granted for State spending under the current State Budget ends on July 1, 2025, so policymakers will need to agree on some form of new legislation to keep State services operating beyond that date.