Governor includes gambling in 2-year NH budget

CONCORD, N.H. (AP) -- Gov. Maggie Hassan called on New Hampshire lawmakers Thursday to compete with Massachusetts by legalizing one high-end casino and included licensing fees in her two-year budget to pressure them to act.

"The question is: Will we allow Massachusetts to take revenue from New Hampshire's residents to fund its needs, or will we develop our own plan that will allow us to address social costs and invest in our priorities?" she said in her budget address.

Hassan included $80 million in her budget from gambling licensing fees that lawmakers would have to replace with other revenue or cut programs if they failed to approve gambling. The House has never passed casino legislation. The Senate has a bill to legalize video slots at one casino, but dedicates the money to highway improvements, higher education and development in the North Country

Hassan only included money in her budget for operating expenses at the Transportation Department and left it to lawmakers to settle how to pay for the Interstate 93 expansion and other badly needed road improvements she said are needed. Besides the Senate proposal to use gambling revenues, a House bill would instead raise the state's gas tax and vehicle registration fees to pay for highway and bridges.

Hassan said that "as it stands, we barely have enough to do the very minimum: patching roads and bridges together, plowing our highways, and keeping state troopers on the road."

"We must develop strategies for a long-term solution, for both operations and road construction, and we must do it together, working toward a consensus solution," she said.

Senate Republican Leader Jeb Bradley said he was confident the Senate would pass the gambling bill, but a gas tax increase would face a tough time in the Senate. He said the reverse probably would happen in the House — the House would pass a gas tax and not gambling.

"It's a gamble and setting us up for failure," House Republican Leader Gene Chandler said of including the gambling money.

House Speaker Terie Norelli, a Portsmouth Democrat, said Hassan had every right to propose a spending plan based on policies she endorses. Norelli said she does not know if the House will approve gambling, but if it does not, then the budget will likely be cut.

Hassan proposes spending $11.1 billion from all revenue sources — including federal, highway and state taxes — or 10 percent more than the current $10.1 billion, two-year budget. The state tax portion of the total budget is $2.8 billion or 7 percent higher than the current $2.6 billion budget. That is a $184 million increase over two years.

Hassan also included $38 million in her public works budget for a new women's prison, beefed up spending on mental health, restored aid to the community colleges and gave the university system 90 percent of the aid it had been getting by the second year. She proposes adding money for charter schools, but giving the state education board more authority over their placement and the type of school.

She also would expand Medicaid in the budget under the Obama administration's federal health care overhaul, citing the long-term benefits to the state's poor. She would partially restore funding for a program to help troubled kids who aren't delinquent.

Bradley of Wolfeboro objected to including Medicaid expansion in the budget because it commits New Hampshire to a program based on a funding promise from the federal government that is trillions in debt.

"For too long, our corrections system has woefully neglected women. Like our men's prison, our new women's prison must offer facilities that can provide the programs that help individuals safely move back into society when they have served their sentences," she said.

A new women's prison has been discussed for years, but has not been included it in a public works budget. The state is being sued over conditions at the women's prison in Goffstown.

Hassan said the community colleges and university system have promised to ask their boards to freeze in-state tuition in exchange. Interim University System of New Hampshire Chancellor Todd Leach said he was confident his board would approve the freeze.

Hassan also would hit up smokers to help pay for spending. They would pay $1.98 per pack in her budget— a 30-cent increase.

She also includes $200,000 each year in the budget for search and rescue operations. For years, the Fish and Game Department has funded the program with license fees on hunters, anglers, snowmobiles and off-highway-recreation vehicles. The program has been running a deficit and critics argue hikers should pay a share since most of the rescues involve them.

"Ensuring public safety also means adequately recognizing that search-and-rescue is an integral state responsibility," she said.

Hassan would suspend several tax breaks the last Legislature extended to business due to uncertain fiscal times. She also would repeal a law giving businesses a tax credit for donating funds to nonprofit organizations that would in turn use the money to give scholarships to students to attend public or private schools. Civil liberties groups are suing to block the law.