The information contained in this article is not intended as legal advice and may no longer be accurate due to changes in the law. Consult NHMA's legal services or your municipal attorney.
The 2025 legislative session is nearing the home stretch and all eyes remain on the state budget, which the House handed off to the Senate on April 10.
The drop-dead date for the Senate to pass a budget is June 5, after which—if history is any guide—the House and Senate will form a committee of conference to hash out the differences in the spending packages passed by each chamber. The deadline for the House and Senate to vote on a mutually agreed upon budget to send to the governor is June 26.
The budget has already undergone dozens of changes since the governor introduced her plan back in February. It’s no secret that the state’s revenue picture is not a rosy as the past few budget cycles when federal COVID spending and soaring business tax revenues allowed for numerous, one-time appropriations.
While there’s no crystal ball powerful enough to see what the final state budget will look like, the revenue squeeze is likely to have an impact on state aid to municipalities, as well as to state programs that municipalities rely upon. NHMA is monitoring these key sections of the budget impacting our members:
Meals and rooms tax: As you know, municipalities have faced a long history of receiving less than the statutory 40% share of the meals and rooms tax. It was only in 2021 that local governments began receiving 30%, following more than a decade of reduced funding. In a tight budget year, this revenue source can be enticing to legislators looking to fill other holes. NHMA continues to push the message that this state aid is a crucial resource for all of our 234 members,
supporting essential services and infrastructure.
Program funding: Although housing availability is the number one issue, it remains unclear whether there will be any additional funding for the Housing Champions and InvestNH housing programs, as well as for the state share of wastewater projects under the State Aid Grant (SAG) program.
Retirement: Lawmakers are moving forward with a plan to legalize video slot machines, and the governor has stated that part of the anticipated new revenue will be used to pay for costly changes to NH Retirement System (NHRS) benefits for about 1,500 “Group II” police and fire personnel hired before July 1, 2011. These changes will cost in excess of $200 million over a period of years, and we are watching to see if the legislature keeps the commitment made by the governor to fund the full cost of these changes and not pass them down to cities and towns.
Other: We are following proposals in the budget to eliminate the Housing Advisory Board (HAB) and the Board of Tax and Land Appeals (BTLA) and modify the operations of the Right-to-Know Ombudsman. (Note that the House removed the repeal of the BTLA on the floor on April 10.)
The other dominant issue this year has been statewide zoning mandates, which have been the subject of dozens of separate bills. These proposals, broadly framed as a response to the state’s housing shortage, would take away local control, increase administrative burdens and further strain infrastructure and parking. What ultimately makes it to the Governor’s desk remains unclear as of this writing.
In addition to the budget and zoning mandates, there are multiple proposals impacting municipal legislative bodies (warrant articles, default budgets, tax caps, etc.) and attempts to eliminate balance billing for ground ambulance services without putting the cost of uncompensated transportation by municipal ambulance service solely on property taxpayers.
While it can be said for any legislative session that the decisions made will have a long-term impact the state, 2025 is shaping up as one of those rare sessions where those impacts will be talked about for years to come.
Follow Bills That Matter to You Online
NHMA provides members access to FastDemocracy, anonline bill tracking platform, for efficient, real-time updates to legislative activity of interest to members. This tool can help ensure that you know when the bills that you care about most are scheduled for public hearing or votes.
Visit our online Bill Tracker page to learn more and feel free to subscribe to weekly or daily updates on subjects and bills of interest.