Even More (well, less…) Fun in State Budget Funding with Phil Sletten (part 2)

In Part 1, Liz and Phil Sletten (NH Fiscal Policy Institute) talked about the intentional cuts lawmakers made when it comes to revenues - and now, in part 2, they cover the choices New Hampshire lawmakers made in how money will (and will not) be spent.

Links:

• Committee of Conference Budget Nearly Matches Senate Version on Spending, Trims Retirement and University System Appropriations (NHFPI)
• NHFPI’s Budget landing page
• NHFPI’s “Uncharted” Podcast
• Who is Experiencing Poverty in the Granite State? (NHFPI)
• YDC Abuse Victims Say Ayotte Breaking Settlement Agreement (InDepth NH)
• Business Tax Rate Reductions Led to Between $795 Million and $1.17 Billion in Forgone Revenue for Public Services Since 2015 (NHFPI)
• Households with High Incomes Disproportionately Benefit from Interest and Dividends Tax Repeal (NHFPI)
• New Hampshire’s interest and dividends tax – and why it’s a hot campaign issue – explained (NH Bulletin)
• Average Cost of College by State (Education Data Initiative) – New Hampshire has the second highest in-state tuition cost

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Episode Transcript

Liz Canada (00:00):
So I went back to a previous email I had sent you.
I literally did the mostresearch for this episode that
I've done, actually, is goingback into my archives of emails.
And I have one from 2022 whereI emailed you a question and you
responded in four minutes aswell back then.

Phil Sletten (00:17):
Well, you ask good questions, Liz, right?
Those are ones that I haveanswers to.

Liz Canada (00:23):
So...
You are listening to NewHampshire Has Issues, and I am
your host, Liz Canada.
And I am just here to say, ifyou haven't listened to part one
yet with Phil Slutton, pleasego back and do that first,

(00:44):
because the topics we're goingto cover in this episode is
about the money that goes outfrom the state.
But you have to betterunderstand how money is coming
into the state and how it isnot, because that money has gone
down by a lot.
You can hear me go through aepisode.
So before you listen to thisepisode, go back, listen to the

(01:07):
first Phil Slutton episode.
If you would like to supportthe show, incredible.
Thank you so much.
You can do that by visitingpatreon.com slash NH has issues.
I have the link in the shownotes.
Okay, thank you for listening.
And I will pass it back over tome in shock and awe still, and
Phil Slutton, the researchdirector at New Hampshire Fiscal

(01:28):
Policy Institute.
Let me try to do a Quick andsnappy recap.
Cut a tax that was for superwealthy folks on wealth that has
generated a lot of money forfolks who have a lot of money
sitting in a CD or stocks orsomething like that.
Got rid of that a few yearsago.
Yes, so far.

(01:48):
Yes.
I hope so.
Yes.
Thank God,
Well, I should say itdisappeared in 2025.
So this is the first year thatwe have nothing
whatsoever.
Because it had been phased out.
So it's gone for this nextfiscal year.
For the first time, no interestand dividends tax since 1922.
Other taxes have beenintentionally decreased?

Phil Sletten (02:07):
Yes.
Business profits tax, businessenterprise tax, meals and
rentals tax also went down ahalf a percent as well in the
2021 budget.

Liz Canada (02:15):
Which state lawmakers, those are the folks
who make those decisions, arethe folks in the state house.
Yes.
Okay.
And then we also have to beaware of variables happening now
where tourism may be affectedby how folks are feeling about
how much money they actuallyhave for travel.
And so that could impact themoney in New Hampshire as well.

Phil Sletten (02:41):
Yes.

Liz Canada (02:41):
Okay.
So we also have what money isbeing spent in the state.
So we have all of thesevariables.
cuts intentionally.
This wasn't magic that thishappened.

Phil Sletten (02:53):
No, none of this is magic.

Liz Canada (02:57):
There is no magic in the state budget.
It's all hard numbers anddifficult to process, actually.
What decisions did statelawmakers make this year?
Because now the process isover.
They finished it up.
They wrapped it up.
It was a photo finish, itseemed.
But what decisions did theymake in terms of how they are

(03:18):
going to spend money, what theyare actually going to fund.
Because the episodes we've hadabout child care and housing and
things like that, did they doit, Phil?
Did they fund the things inthis environment?

Phil Sletten (03:31):
So housing and child care, which I'll start
with those two because youmentioned them, those are very
small parts of the state budget.
We're talking about investmentsin housing supports, whether
that's housing assistance,funding, you know, for example,
the Housing Appeals Board, aidto the Affordable Housing Fund
that flows from the real estateThat portion of the state budget

(04:01):
is probably about four tenthsof a percent.
of all the state budget is forhousing.

Liz Canada (04:10):
That's

Phil Sletten (04:10):
it?
Yes.
And childcare is a little bitless, at least if we count
childcare that's aid toindividuals and to childcare
centers, is a little bit less asa percentage of the state
budget.
So we're not talking aboutsignificant portions of the
state budget, right?
And when it comes to thedollars spent that go out the
door.
Again, we're talking about alot of health services.
We're talking about a lot ofeducation, right?

(04:31):
Those two together, health andhuman services and education are
about two thirds of the statebudget.

Liz Canada (04:35):
So Phil, because they are such a smaller amount.
They were funded all the way,right?
That's what you're going totell

Phil Sletten (04:42):
me?
Not quite.
So there were many investmentsin the state budget that just
ended.
There were significantinvestments in housing in that
state budget.
There was an additional $50million in one-time funds put
into housing.
There was also an additional$15 million in state money put
into early care and education orinto child care.
And that followed a lot offederal money that went into

(05:05):
support both those efforts interms of keeping childcare
infrastructure stabilized in thestate and building that
infrastructure and helping keeppeople in their apartments and
their homes with federaldollars, particularly the
emergency rental assistanceprogram that came out of the
several large federal aidpackages associated with the
COVID-19 pandemic.
So that federal money has beendisappearing.

(05:26):
The state put in some of itsown money in the state budget
that just wrapped up.
In the new state budget, thereis still some continued
appropriations for services tounhoused individuals, right,
homeless and how And there is aprovision where if there are
certain federal block grantdollars available, then the

(05:47):
state will repeat its $15million investment in early care
and education workforce withthose dollars.
But there aren't newinvestments.
There are some repeatedinvestments, but there aren't
new investments in housing andchildcare in the state budget.
It's not maintaining status quobecause the current state
budget or the state budget hasjust wrapped up.
Okay, so not...

Liz Canada (06:19):
Not great, is what I'm hearing.
Not super great in terms of howour state is maybe prioritizing
those issues specifically.
What about public education andschool funding?
How did that go in terms of thestate budget that, by the time
this is published, we arecurrently in?

Phil Sletten (06:37):
So we'll split public education into higher
education and K-12 education.
Oh, good.
For higher education, the storyis a little less favorable.
The community college system ofNew Hampshire did Wow.
I don't think

Liz Canada (07:31):
I talked about this with Zach on our school funding
episode, but I believe, and Iknow that you know this, I
believe that New Hampshire hasthe highest in-state tuition for
our public colleges anduniversities compared to other
states.
We have the highest in-statetuition for our own public
colleges and universities.
students.
Is that right?

Phil Sletten (07:51):
I'm not remembering the number off the
top of my head, but I thinkwe're in the top three.
Top three.
Okay.
One thing that's very clear, ifyou look at the data, no matter
how you slice it, by $1,000 ofpersonal income or by dollars
spent per student or by apercentage of tax and lottery
revenue the state collects, weare at the bottom relative to
all 50 states when it comes topublic spending, public state

(08:15):
dollars on our four-year highereducation.
So we're at the bottom there.

Liz Canada (08:20):
How the state invests in the higher education
system.

Phil Sletten (08:23):
Right, in terms of the states, because the state
budget doesn't include theentire university system.
The state budget just includesthe amount that the state as an
entity provides to theuniversity system, which it has
established but doesn't controlthe budget of on a line-by-line
basis.
It gives basically a grant fundto the university system and
the community college system.
And that amount for theuniversity system is going down

(08:47):
in the state budget that wasjust approved.

Liz Canada (08:50):
Not favorable.
Less favorable.
Less favorable, not favorable.
for the higher education.
And level funding, you said forthe community college system,
level funding means the samefrom this last budget to this
budget, whatever they got justabout.
last time the community collegesystem is getting this time as
well.

Phil Sletten (09:08):
In neither of these is there like an automatic
inflation adjustment oranything like that, or a cost of
education index adjustment.
It is what policymakers decideto put in those budget lines
every two years.

Liz Canada (09:18):
Okay.
Okay.
So that's higher education.
Not great.
How about K through 12?

Phil Sletten (09:23):
So in K through 12, we actually see some added
funding.
This is a place wherepolicymakers did not, there were
many parts of the state budgetwhere they sought to find
efficiencies and saw to trim inpublic K-12 education, so the
aid to school districts, we seean increase in funding,
particularly targeted at schooldistricts that have relatively

(09:46):
low property values per pupil.
There's an additional layer ofeducation aid that was added on
to that.
Now, the House had actuallyproposed also adding more aid
for special education throughthe education funding formula.
The Senate took that out, butboth of them kept the governor's
targeted special education aidas well.
So, All that is to say, in theend, there's more aid for

(10:08):
special education in the statebudget than there was in the
previous state budget.
Now, that increase matches thecosts that were reported by
school districts in the lastyear.
So it basically prevents thataid from being prorated, from
being reduced relative to whatthe need is that school
districts are reporting.
So it's, you know, I don't knowthat I'd call it extra, but it

(10:28):
is matching what the schooldistricts are reporting as
costs.
And I'm, you know, and that wascosts in a prior year So that's
what they've set up for thenext two years.
So we'll have to see how thosecosts trend over time.
The additional aid that was putinto the state budget was put
in by the House and the Senatekept that.
There was a proposed $10.2million reduction in assistance

(10:50):
for the Manchester schooldistricts.
And that was basically amodification to the formula that
would have only affectedManchester, maybe would have
affected Nashua, depending onthe demographics and how they'd
break out in Nashua, thedemographics of the students.
That $10.2 million was proposedfor this budget biennium.
But in that photo finish thatyou referred to was pushed to

(11:12):
the next year of the nextbiennium.
So it's still on the books, butit's delayed by a year, which
gives policymakers both inManchester and at the state more
time to adjust if they wouldwant to.
They've pushed it out to happenduring the next state budget.
So it's in state law, but it'spushed out further.

Liz Canada (11:29):
They

Phil Sletten (11:30):
could change it before it happens.
There are two legislativesessions, including a budget
session in between.
And the Manchester schooldistrict also has to adjust
because they'll be setting theirbudget with that assumption
baked in probably in early 2027and that reduction would take
effect july of 2027 so there'syou know it's it's not a copious

(11:52):
amounts more time but it ismore time than would have been
there was also a boost infunding for public charter
schools and and that was thatwas a pretty significant
increase in public charterschool funding and an increase
in funding for education freedomaccounts and when i say
increase in funding i'm talkingabout increase in budgeted
funding and And again, we're nottalking about school districts
anymore, but we're talking abouteducation more generally.
I'm talking about an increasein budgeted funding.

(12:14):
The policy is really whatdrives it, however, because just
like the education aid thatgoes to local public schools,
which is based on how manystudents are in that school
district, and they project howmany students they're going to
have, but if they have more thanthat, they still get the
reimbursement from the state.
That's also true for educationfreedom accounts, which are
those individualized paymentsthat go to families that don't

(12:35):
have their kid or kids in publicschool and instead are
accessing those dollars thatwould have gone to the public
school district.
The income cap on eligibilityfor that program was lifted.
There is an enrollment cap thatcan be adjusted each year
upward, but does prevent theprogram from adding all the
potentially eligible students inone year But there was
additional funding added to thatin the budget lines.

(12:58):
However, just like the schooldistrict payments, if there are
more students than are projectedwho show up in the Education
Freedom Account program, thenthey would receive those dollars
as well, up until the cap onthe number of students, which
doesn't affect all students, itjust affects some students.
And I'm happy to talk about thedetails of those a little bit.

Liz Canada (13:18):
And this is good because this is a recent episode
about the Education FreedomAccounts, and the cap is kind of
Kind of squishy, a little bit,because it's a cap of
quote-unquote 10,000 students,but that cap doesn't include
students who were alreadyenrolled.
Is that true?

Phil Sletten (13:36):
So for students who were under what was the old
income cap, and in certain othercircumstances, I think, for
example, individuals withdisabilities, right, a student
with a disability, the numbersof those students enrolled can
exceed the cap.

Liz Canada (13:49):
Right.

Phil Sletten (13:49):
So by the way, if you reach within, I think it's
1,000 students of the cap, thenthe next year the cap is
automatically raised by 25%.
So it's a within-year cap, butit can be adjusted each year.
So yes, it is not a hard cap,if you will, and if that makes
it a squishy cap, then it's

Liz Canada (14:07):
a squishy cap, but it's not a hard cap.
It's a bit squishy, yeah.
10,000 is not like we hit10,000, no more students in this
program.
There are actually these littlecaveats of like, well, if
you're a sibling, you can stillget the cap.
education freedom account.
If you have an income of 350%or lower, just like the old
system, you can get an educationfreedom account, even if we hit

(14:28):
the 10,000.
So like, it's not not exactly acap.
And like you said, it canincrease every year, if they get
within 1000, they just bump upthe cap, which is not how caps
work.
But that's okay.
We don't have to get into thesemantics of that one, too, I
guess.

Phil Sletten (14:44):
And if the cap is not increased for two years in a
row, then it disappears.
The

Liz Canada (14:51):
cap entirely disappears?

Phil Sletten (14:53):
That's my understanding of what's in the
statute.

Liz Canada (14:57):
Welcome to New Hampshire Has Issues, the
podcast that dares to ask, whatis a cap?
What does it mean?
What does this word mean byitself?
Okay, boy oh boy.
What are the other issues thathave been debated besides the
topics we've already covered ofchild care, housing, education?

Phil Sletten (15:12):
So the House had in its budget proposal included
a reduction in Medicaidreimbursement rates.
Remember, Medicaid is thesingle largest program the state
operates, right?
It included a reduction inMedicaid reimbursement rates by
3% across the board.
It had included a significantreduction in funding for
community mental healthservices, about a 37.5%
reduction there, and reducedfunding for the developmental

(15:36):
services waitlist, which meantthat there would have been a
waitlist of, the state had atleast identified probably 278
people who would have beenwaiting for funding for
services.
The Senate didn't agree withthose, and those reductions
didn't end up in the finalversion of the state budget, so
that's not included.
There was a large discussionaround what some of your

(15:57):
listeners may have heard of,referred to as Group 2
retirement.

Liz Canada (16:00):
Oh, Group 2, the talk of the town, Group 2, yes.

Phil Sletten (16:03):
So what does that mean, Group 2?
We're talking about publicsafety personnel, really police
and firefighter personnelprimarily, in local governments
and the state government, are ina separate retirement group.
And there was a change in lawin 2011 that affected the
retirement benefits thatindividuals who had recently
become employed, it changed theamount that they would have

(16:26):
received relative to what theywere expected when they agreed
to be employed in theirprofession, right, or in that
particular job.
So that group of individuals,about 1,500 individuals now.
That law change in 2011 wassomething that the governor had
included in her budget proposaland the House had included in
its budget proposal.
The Senate included a versionof it.

(16:46):
Reversing the effects of thatchange for that particular group
became a key point ofdiscussion.
And it wasn't until the secondto last day or the last day
before the deadline, if youwill, that there was a final
agreement on exactly how thatwould be funded and how the
benefits, the retirementbenefits for those individuals

(17:07):
would be funded.
So that was another key point.
And that's the equivalent ofabout $27.5 million a year once
that's ramped in.
Right now in statute, that's$27.5 million a year from fiscal
year 2027 all the way to fiscalyear, I think it's 2034.
So it's a long run ofappropriations, which, of
course, future policymakers canchange if they choose to.

(17:28):
That's part of what happened in2011 is that future
policymakers then changed whatwould have been the retirement
benefits at the time.

Liz Canada (17:34):
And now policymakers change the 2011 policy.
things come back.
We got rid of a 1922 tax thathas been part of our revenues
for 102 years.
But yeah, okay, things couldchange before all of that takes
effect.

Phil Sletten (17:48):
Yes.
The House also proposed aseries of reductions in services
that would have had substantialeffects on relatively small
agencies and programs, but thoseagencies and programs can have
big impacts.
So, for example, the Houseproposed eliminating family
planning dollars, and that issomething that the Senate
brought back And that partialreturn is what ended up in the

(18:12):
final version of the statebudget.
Same with the State Commissionon Aging, right?

(18:39):
That was brought back after theHouse proposed eliminating it.
It was brought back by theSenate, but not fully funded in
the end product.

Liz Canada (18:46):
The House made so many changes to cut things
entirely, just huge, significantchanges that they had proposed.
And then the Senate is bringingback things partially.
And I'm not talking to you,Phil.
I'm talking through you.
That's how we say it in ourhouse.
I'm talking through you.
But it's like, you still tooksome of it away.

(19:07):
Like...
Yes, you put it back, butthat's because it was all gone,
and now only part of it is back.
So it's still a reductionoverall.
All right, that was my timeout.
I'm timing back in.
Just want folks to understand,the House gutting it entirely,
and then the Senate putting inpart of it, it's not an overall

(19:28):
win in the grand scheme ofthings compared to the past
cycles.

Phil Sletten (19:33):
And when a new budget cycle starts, or a new
set of budget discussions startin a odd-numbered year, then the
governor's budget proposal isoften used as the baseline for
measurement, right?
Because there's the currentbudget, right, or the budget
that was passed two yearsbefore, but state agencies have
more information about whattheir costs are.
The governor may have certaininitiatives, but the state

(19:56):
agency budgets are often used asthe baseline at that point.
And then when I say theline-by-line state agency
appropriations that the governorproposed are often used as a
baseline for comparison.
So the governor's budgetproposal was about the billion
over two years.
The House was about $15.5billion over two years.
The House had much lowerrevenues that they projected.
And the Senate had morefavorable revenues.

(20:19):
There was actually a $382million gap in the revenues
between what the House built itsbudget on and what the Senate
built their budget on.

Liz Canada (20:24):
That's huge.
That's a

Phil Sletten (20:25):
lot.
It's a lot of money.
And the Senate brought theirbudget total back up to about
$15.9 billion.
So not all the way back to whatthe governor had proposed
appropriating.
And we see that in some of theservices Now, the governor in
her proposal did try to reallyhold the line on services and
fund services, even if, youknow, it's a modestly adequate

(20:47):
level.
There were not large reductionsin services in the governor's
budget proposal.
There were some significantswings.
There was a reduction at theuniversity system, for example,
and reductions in some budgetlines, like the Choices for
Independence Medicaid waiverprogram for older adults and
adults with physicaldisabilities to receive care in
their homes like that.
That did happen in thegovernor's proposal, but mostly
it held the line on services.
So we're seeing that And thenthat after the legislative

(21:10):
process, it's a lower amountthan that amount by, again, on
the order of about $100 million.
I've

Liz Canada (21:18):
had a few folks reach out to ask about the Youth
Development Center and likewhat is happening?
What is the funding?
I think there are lawsuits,right?
Like what does the statebudget...
show us in terms of how thestate is proceeding with the
Youth Development Center?

Phil Sletten (21:34):
So when we talk about the Youth Development
Center or YDC, we're generallyreferring to allegedly terrible
things that happened to childrenwho are nominally in the
state's care over decades.
This is a big, sprawling topicin terms of both its
implications and how people areapproaching it and how people
are trying to address this.
So on the fiscal side, on whatis the impact on the state's in

(21:59):
terms of its fiscal liability,which is a very dry way of
talking about what is a reallydifficult subject to talk about.

Liz Canada (22:06):
Absolutely.

Phil Sletten (22:07):
When we're talking about the state budget, this is
where budgeters have to havetheir heads.
What is the state's liabilityhere?
There are two primary ways thatpeople have been effectively
suing the state or approachingthe state with legal action for
compensation for the, again,allegedly terrible things that
had happened to them when theywere nominally in the state's

(22:27):
care.
The first is going to court andsuing the state.
And that is a big variable.
We don't know what the cost tothe state will be from those
lawsuits.
We just don't have a good ideaas to what they will be.
Because

Liz Canada (22:40):
there are quite a few folks who are potentially in
lawsuits.

Phil Sletten (22:44):
Yes.
And the dollar figures so farresulting from those have been
very large.
In the new state budget,there's $10 million that is
appropriated for just thesettlement, the out-of-court
settlement from an individualwho had sued the state and was
pursuing the case in court.
That out-of-court settlementwas $10 million.

(23:06):
that was appropriated in thecurrent state budget.
For one person.
For one person.

Liz Canada (23:11):
Yep.

Phil Sletten (23:12):
The state also set up a settlement process so that
people, individuals, couldinstead of going to court,
because court can be painful fora lot of reasons, instead of
going to court, apply to the YDCSettlement Fund.
I'll shorten the name to that.
The Youth Development CenterClaims Administration Settlement
Fund.

Unknown (23:32):
Yep.

Phil Sletten (23:33):
That was under the judicial branch.
The new state budget actuallymoves it to the executive
branch, but under the judicialbranch, that was a process where
there was a framework, a legalframework for negotiating how
much an individual would becompensated depending on the
claim that they make, dependingon the allegation that they
have, depending on what happenedto them, right?

(23:54):
And that is a way that thestate could reduce its liability
relative to what could havehappened in court, and also in
what could be perceived as aless painful process, get
compensation to an individual.
And there are sort of statutorybrackets for if you're alleging

(24:14):
this, and there's evidence ofit, then here's the compensation
band.
That process has, and we'rerecording at the end of the
state fiscal year, and this isactually the end of the period
through which people can makenew claims, As of the end of
March, there were about $1.4billion worth of claims that had

(24:38):
been made through the claimssettlement process.
Wow.
And so that's a lot ofpotential harm done and a lot of
potential dollars, right?
That then the state has tospend on that and can't spend on
other things.
The state's process is thestate set up a framework so that
it would pay out at maximum $75million a year.

(25:00):
So that's the maximum amountthat through the settlement
process the state would pay.
That $75 million a year needsfunding.
And in the state budget, thegovernor's budget didn't include
any funding for it.
The House added in $20 million.
And the Senate said theproceeds from the sale of what

(25:22):
is the old Youth DevelopmentCenter, but the Sununu Youth
Services Center building inManchester, the proceeds from
that sale will also go to thesettlement fund.
And the estimate that they had,which isn't formally
appropriate in the state budget,but the estimate they had was
that that would generate $80million in state fiscal year
2027.
Whether it will or not, wedon't know.
This is in that category ofprojections, right?
We don't know.

(25:42):
But whatever that salegenerates will go to that fund
as well.
Even if it were $80 million,then we're talking about $100
million over two years, which,Liz, with your pencil and paper,
you know that that's not $150million over two years, which
would be $75 million a year.

Liz Canada (25:58):
I didn't even need my pencil, Phil, for

Phil Sletten (26:00):
that one.
Right, there we go, right?
Well, I can see for those ofyou, I know you're all listening
and not watching, but I see itin Liz's ear.
There it is, yeah, there it is.
So there's then a question of,does this state budget
appropriate enough to cover...
the claims that could be comingin from the Youth Development
Center and the amount that itneeds to pay out.
And if it doesn't, where doesthe additional money come from?

(26:22):
And does that liability thatthe state has evolve in some
other way through the courtsystems or through law changes
that means that the fiscalliability to the state grows
even more or we get somecertainty around what the number
is.
Those are things we don't know.

(26:43):
We didn't know going into thisbudget cycle.
This budget cycle did set aside$20 million for the Youth
Development Center SettlementFund and $10 million for a
single case.
But we don't know what thatfiscal pressure on the state
looks like as we move forwardinto this next biennium and
policymakers with the amount offunding that they've devoted to

(27:04):
it.
are certainly, certainly peopleare pointing out to them that
this has not resolved the amountof money that's needed, that's
likely needed under state lawgiven the $75 million a year
appropriation and whatever thenhappens through court cases.

Liz Canada (27:19):
That is a huge deal and potentially a huge amount of
money that they have not, Idon't know, earmarked, set
aside, considered, factored in.
Like, that's wild.
Yeah.
I'm like speechless.
There's so much to take inabout the state budget because

(27:42):
the process is long.
There are a lot of peopleinvolved.
There's a lot of sort ofguesstimating, estimating,
projecting, knowing the future,gambling, literally and
figuratively.
And then there are all thesereally important programs that
exist that and folks in thedepartments who make sure these

(28:03):
programs happen.
And some of them might belosing their jobs, right, in the
different departments.
Like if there are cuts tocertain departments, like staff
who have had jobs for a whilemight be losing them because of
the cuts.

Phil Sletten (28:17):
This budget will eliminate positions at the
Department of Corrections, forexample.
About 60 positions at theDepartment of Corrections will
be eliminated in this statebudget.

Liz Canada (28:28):
Yeah.
So...
I think about state budget.
It seems so wonky.
There's numbers.
There's math problems.
It feels like you're taking theSAT or ACT or whichever one you
took.
But it's also people andhumans, and it involves all of
us.
So even if I'm not covered byMedicaid, that may not directly

(28:51):
impact me.
But there are so many parts ofthe state budget that will
impact impact my day to day lifeand impact people I care about
as well.
I imagine it touches all thefolks in the state, not just
ones who maybe are part of aspecific program.

Phil Sletten (29:07):
It is the single most consequential piece of
legislation that any legislatorin a two-year term votes on
unless there is something wildthat happens with some other
piece of legislation.
And, you know, something like apandemic, right?
That might lead to some otherpiece of legislation that would
be more consequential.

Liz Canada (29:26):
Never heard of one, Phil.
I have no idea what you couldbe talking about.

Phil Sletten (29:29):
You know, these things fade into our memories,
right?
Yes.
But...
You know, that part of thereason for that is because the
state budget is structured in away that allows it not just to
be all of the funding for moststate operations for the next
two fiscal years.
But also a lot of policies getattached to the state budget.
There are certain people andgovernments, including the

(30:19):
governments of Syria, Iran,North Korea, China, and Russia
within the borders of the state.
There's the elimination of carinspections, right?
That starts in 2026.
That's all wrapped into thestate budget.
And there's a lot more wrappedinto the state budget because it
has also become a policyvehicle as well as a funding

(30:42):
vehicle.
And that is something thatmakes it even that much more
more consequential.

Liz Canada (30:47):
The DEI initiatives, that prohibition, that feels
very unwieldy to me.
I can't quite figure out Whatis not going to be impacted by
that?
Because I think of if a schoolhas services for students with
disabilities, isn't thatdiversity, equity, and

(31:07):
inclusion?
Isn't that an initiative?

Phil Sletten (31:10):
These are questions that we'll have to
have probably attorneys andcourts figure out.

Liz Canada (31:15):
Still?
What do you mean?
You don't know this answer?

Phil Sletten (31:18):
I don't know the answer to how this would shake
out.

Liz Canada (31:21):
I don't think anyone does at this point, really.
I think there's a lot of grayarea in that.
You know, what counts

Phil Sletten (31:29):
as a DEI initiative?
Phil, you have

Liz Canada (32:03):
given me so much information.
We are so lucky to have you inNew Hampshire working on this
day to day, every single day.
I assume you work on a dailybasis.
both years of the biennium.
You don't get a long nap nowthat the budget has passed.

Phil Sletten (32:18):
I mean, I will sleep more, but I don't just get
a long nap now.
I don't go into hibernation fora year

Liz Canada (32:25):
and then wake up with the next state budget.
Off he goes until next year.
No, he's still around.
Phil, so many times in ourdiscussion today, I am rendered
speechless by what has happened.
And I was paying attention allyear to the state budget
process.
I can't even imagine for folkswho are hearing all of this for
the first time.

Phil Sletten (32:46):
This is part of why we at the New Hampshire
Fiscal Policy Institute dedicateour time.
six months of everyodd-numbered year to learning as
much as we can about it andexplaining as much as we can
about it because there are somany moving pieces, so many
things move in and out of thebudget through the process.
It is really several full-timejobs to keep track of it all.

(33:07):
And thank you for having me onthe show to ask about it.

Liz Canada (33:11):
Yeah, thank you, Phil.
I'm so appreciative of yourtime of talking through this.
In the show notes, I'm going tohave a ton of your reports and
blogs and so forth.

Phil Sletten (33:20):
We have our webinar series as well.
as well that we did on thestate budget.
So if people want to haveinformation about the state
budget spoken to them, asopposed to reading graphs and
charts and text, we have therecordings from those webinars
online too.

Liz Canada (33:33):
They're all excellent.
I know I gave you an impossibletask of talking about the state
budget with no charts.
I gave you no opportunity forcharts, but I will link the
charts and webinars in the shownotes for people.
It's

Phil Sletten (33:45):
a fun challenge, Liz.

Liz Canada (33:47):
You did great.
A++.
I did a math problem over here.
I am thriving.
I'm right in my element ofhaving the pencil ready to go.
Phil, thank you so much.
I really appreciate it.

Phil Sletten (34:00):
Thank you, Liz.
It was great to be here.
It was a lot of fun.
We covered a lot of ground.
There's even more to cover.
There's

Liz Canada (34:05):
more to cover.
I know it.
I might have you come back onin like a year.
We'll see how you're doingafter a year of Budget World.

Phil Sletten (34:12):
We'll see where we are in a year because there may
be a lot of federal changes atthat point that affect the state
budget again.

Liz Canada (34:17):
Oh, it's like a movie trailer for a sequel.
We'll see what happens in theEmpire Strikes Back Federal
Edition.
If you find the information inthese episodes informative,

(34:39):
funny, entertaining, helpful,please share them with others.
Send the episode links to otherfolks who you think might
appreciate them or enjoy them ormaybe even, dare I say, learn
something from them.
Thank you for listening.