Gubernatorial budget vetoes are a dangerous game in New Hampshire.
They often do not have the desired effect and frequently backfire hurting the credibility and electability of the person who blocks the budget from implementation.
In recent years, divided government with one party controlling the legislature and the other the governor’s office has been the rule and not the exception since 1996 when former Gov. Jeanne Shaheen was elected to the corner office.
Over the 25-year span, three budgets have been vetoed: Friday’s by Gov. Chris Sununu, the day after the legislature approved it, 2015 by former Gov. Maggie Hassan, and 2003 by former Gov. Craig Benson.
Hassan’s and Sununu’s were with the opposing party controlling the legislature, while Benson vetoed his own party’s budget saying it spent too much.
Budget vetoes were more common in the 1970s and early 1980s when Meldrim Thomson and Hugh Gallen were governors.
Both had Republican controlled-legislatures who crafted budgets they disliked.
During Thomson’s last term, the state operated on continuing resolutions, which Thomson favored because it gave him greater control over the budget.
Then House Speaker George Roberts is quoted in an Associated Press article saying Thomson was using dictatorial tactics after he vetoed a budget plan that included an 8 percent capital gains tax, and a tax on soft drinks.
It was a different Republican Party in those days. But Gallen was not impressed as he let a supplemental budget go into law without his signature and vetoed the budget produced in 1981 and an attempt to amend a compromise plan Republican lawmakers crafted. Both vetoes were sustained.
Former Govs. John H. Sununu, Judd Gregg, Steve Merrill and Shaheen never vetoed a budget, although Gregg vetoed the capital budget one year because it contained money for a new Department of Environmental Services building.
The first budget veto in recent years was by Benson, who claimed the Republican-produced budget spent $60 million too much.
The first-term governor held a press conference with a big “VETO” stamp to mark the occasion, alienating many members of his own party.
Almost daily press conferences were held in the Executive Council Chambers by House Majority Leader Mike Whalley and Senate Majority Leader Bob Clegg to blast the governor whose office was within earshot of the political theater.
Two months later Benson acquiesced and signed “a compromise budget” that spent even more money, most of it for his office.
In 2004, Benson was the first one-term governor since 1926 who was defeated when he ran for reelection.
Both Shaheen and Lynch let budget packages produced by Republican lawmakers go into law without their signatures, Shaheen in her first term as governor and Lynch in his last.
The 2011-12 legislature produced a budget that slashed spending on higher education, ended a number of human service programs, mostly for youths, laid off state employees and kept money from the Medicaid Enhancement Tax that until then was always returned to the hospitals after it was used to match federal money.
In his press release announcing he would not sign the budget but would let it become law, Lynch said “In considering whether to veto the budget bills or allow them to become law, I have two major considerations: Could a veto result in a better budget for the people of New Hampshire, and what are the potential consequences of a veto for our people.”
Privately Lynch was concerned if he vetoed the budget package he would receive an even more Draconian plan from Tea Party stoked lawmakers.
Hassan vetoed the 2015 budget package over several issues, including not funding a new state employee contract, and more importantly cuts in business tax rates.
Hassan had won reelection against former BAE executive Walt Havenstein who proposed business tax cuts.
During the election, Hassan claimed the business tax cuts would “blow an $80 million hole in the budget.”
After the election, the Republican-controlled legislature made business tax cuts its number one priority saying New Hampshire had the highest business taxes in New England putting the state and its businesses at an economic disadvantage.
Echoing what was heard Friday, Hassan’s veto message said the budget was unbalanced and “makes false promises about what it funds, and gives unpaid-for tax giveaways to big corporations, many based out-of-state, at the expense of critical economic priorities, including higher education, health care, public safety and transportation."
Then-Senate President Chuck Morse, R-Salem, said the veto “blocks important funding increases that support state agencies and our state’s neediest citizens and creates uncertainty within these organizations. In addition, the veto puts on hold important business tax reductions that are designed to create jobs and stimulate New Hampshire’s business economy.”
When negotiations were complete later that summer, the tax cuts went forward, some accelerated and others delayed, and the new state employees contract was funded, but Hassan’s credibility took a hit, but not enough of one to lose to first-term US Sen. Kelly Ayotte, who she defeated by about 1,000 votes.
Her veto was more a political move than anything else, as Hassan had her eye on the US Senate.
Hassan probably would have been seen in a more favorable light if she had let the budget go into law without her signature.
And the same is likely to be true for Sununu as well.
If the budget is as bad as Republicans claim, why not let it become law. Business tax revenues are not expected to continue their skyward trajectory, so if the budget has a significant deficit in a year, the GOP can blast the fiscally undisciplined Democrats leading up to the 2020 election.
The state has a $260 million surplus according to Sununu in his veto message, but many people are hurting and need some property tax relief, or help for family members plagued with substance abuse or mental illness not saving that money for a rainy day or a new building they will never enter.
Sununu’s veto may be couched in terms of tax increases and sustainability, but it is politically driven.
He may not be running for higher office like Hassan, but he is running for reelection in what could be a larger blue wave than the 2018 election so he wants to cement his base’s support now.
Republicans are hanging much of their political capital on business tax cuts and not the business tax reforms contained in the budget that many state businesses want more than the cuts.
The reforms would end what many businesses see as double taxation when their goods are sold out of state, something out-of-state businesses escape under the current tax system.
The tried and true axiom of tax and spend Democrats does not hold the sway it once did when many people in the state are crying for property tax relief including businesses.
Being inside the State House tends to make people believe only two parties exist, but the largest contingent of voters are “undeclared” or independents.
As has been true for sometime in New Hampshire, independent voters decide state elections. And with the budget veto, the Democrats have a better message than Republicans.
It is easier to make the argument big business does not need more tax cuts at the expense of property tax relief, children’s education and protection, and drug treatment and recovery programs, and repairing a crumbling highway system.
Budget negotiations are ongoing between Sununu and Democratic leaders, and a resolution will be found eventually.
Once the budget is open, everything is back on the table, paid family and medical leave, a capital gains tax, Medicaid reimbursement rates, a new forensic hospital, revenue sharing with cities and towns, additional education aid and ending the waitlist for developmentally disabled services.
Several of the areas Democrats gave up or championed in the budget, like paid family and medical leave, additional state education aid and revenue sharing are very popular with residents and a veto looks like “just say ‘No.’”
Budget vetoes are two-edged swords and the sharpest edge usually is aimed at the governor.
Garry Rayno may be reached at firstname.lastname@example.org