New Hampshire officials are planning to spend more money this year, even as their general fund revenues look to be down slightly, a new analysis revealed.
The Granite State was one of 14 states with a spending increase between 3 percent and 5 percent, according to the National Association of State Budget Officers (NASBO). A further 20 states increased their general fund spending by at least 5 percent.
In September, lawmakers announced a bipartisan compromise on the state’s roughly $13 billion budget that keeps taxes at their current levels through 2020. The accord also included triggers for adjustments to the business tax based on the state’s revenues.
“New Hampshire families have benefited greatly from record-levels of economic growth in 2019,” New Hampshire Gov. Chris Sununu, a Republican, said in a statement this month. “Our focus on fostering the development of our workforce, while making high-paying, quality jobs available has paid off in dividends. 2019 was undoubtedly a banner year for the New Hampshire economy.”
State officials plan to spend $1.56 billion in general revenue funds in Fiscal Year 2020, up slightly from $1.5 billion in 2019.
Granite State leaders expect to bring in nearly $1.6 billion in general fund revenues in the 2020 fiscal year, which is down slightly from 2019, according to the report. Concurrently, they are anticipating decreased revenue from corporate income taxes.
In 2018, New Hampshire took in $481 million in corporate income taxes, a level that decreased to $475 million in 2019, but exceeded their original projection of $400 million. That revenue is expected to lower to $434 million in 2020.
Nationally, lawmakers passed state budgets with a potential recession in mind, NASBO found. States across the board are increasing their rainy day fund balances to improve their preparedness, and New Hampshire officials similarly increased their reserves in recent years.
In 2011, New Hampshire had a rainy day fund balance of $9 million, which increased to $22 million in 2015 and $100 million in 2017. In 2019, the fund’s balance rose to $115 million, where it is expected to remain in 2020, according to the report.
General fund spending nationwide is increasing by 4.8 percent in the 2020 fiscal year, according to the NASBO analysis. In total, 45 states are planning spending increases, predicated on general fund revenue growth of 2.6 percent.
The spending increase comes after states grew their general fund spending by 5.8 percent in 2019, the fastest annual growth rate since 2007.