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Sunday, April 27, 2014

Unconstitutional tax has ramifications for NH politicians

Kevin Landrigan

Legislative leaders were already moving to try to plug a patch onto the flat tire that is state revenues in the wake of a superior court ruling that the Medicaid Enhancement Tax was unconstitutional.

There will be no decisions made by the Senate Ways and Means Committee when the dialogue begins Tuesday, but Chairman Robert Odell, R-New London, is sitting on a House-passed MET bill that he’ll try to attach the fix to at the proper time. ...

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Legislative leaders were already moving to try to plug a patch onto the flat tire that is state revenues in the wake of a superior court ruling that the Medicaid Enhancement Tax was unconstitutional.

There will be no decisions made by the Senate Ways and Means Committee when the dialogue begins Tuesday, but Chairman Robert Odell, R-New London, is sitting on a House-passed MET bill that he’ll try to attach the fix to at the proper time.

The stern warning from Wall Street will help provide bipartisan political momentum for at least getting a temporary fix through before lawmakers head home to mount their re-election campaigns.

Standard & Poor’s has changed the outlook of New Hampshire bonds from “stable” to “negative,” which essentially is a bucket of cold water tossed on Gov. Maggie Hassan and the Legislature to get something done in the wake of the MET ruling.

The report makes clear that if lawmakers fail to act, a downgrade of those bonds is likely to follow. That would be catastrophic even more politically for Hassan and legislative leaders from both parties than it would be for taxpayers.

Somber Moody’s

Another Wall Street warning group has been heard from.

There it was Friday on Page 5 of the U.S. Public Finance Weekly Credit Outlook of Moody’s Investor Service.

“New Hampshire significantly reduced its available reserves during the recession,” the report states.

“The state economy is improving and unemployment remains below the national average, although state revenues have not yet surpassed the pre-recession peak.

“As a result, the state has not replenished available reserves. At the end of fiscal 2013, operating reserves totaled about 3% of operating revenues (excluding federal aid), still well below the peak of 6% at fiscal year-end 2007.

“Modest reserves reduce the state’s options in the event of any immediate repayment related to the MET ruling.”

Moody’s notes the loss would represent a 7 percent budget hole.

“The loss of approximately $200 million in annual MET revenues would create a challenging shortfall for the state, which already has a tight budget,” Moody’s concludes.

There’s an echo in here.

Prospects for the future

House Speaker Terie Norelli’s announcement that she wasn’t running was probably the worst-kept secret in Concord.

There has been talk for more than a year that Norelli had decided that this would be her last term after getting back the gavel and redemption from the drubbing she took in 2010.

Her decision in early 2013 to end a quarter-century of partisan seating and have Republicans and Democrats sit together was a clue; it’s a collegial move she always had thought should be tried, and it has proved to be a success.

Don’t look for Norelli to ride off and remain silent on the Seacoast. The vocal defender of women’s reproductive rights, civil rights and alternative energy won’t go quietly into this good night.

What now?

Well, tell me who’s going to be in the majority after November and I’ll tell you who could be the next speaker.

The low state election turnout; the post-2010 redistricting of the House of Representatives; and the solid field of GOP candidates for U.S. Senate –
Scott Brown and Co. – and governor – Walt Havenstein and Andrew Hemingway – all combine to give the buzz of a GOP comeback in the air.

We’ve seen time and again that opportunity squandered by poor recruiting of candidates farther down the ballot, so we’ll have a much better handle on that after the filing period closes in mid-June.

Former Deputy Speaker Pam Tucker, R-Greenfield, and House Republican Leader Gene Chandler will likely fight it out to be the GOP standard-bearer.

If Democrats hang on –
I’d put odds at 50-50 – Majority Leader Steve Shurtleff, D-Concord, would emerge as the prohibitive favorite.

The former deputy U.S. marshal, Concord city councilor and five-term House member has an easy way about him and is likeable by the influential in both parties.

The decision of Nashua Democratic Rep. David Campbell to retire at year’s end takes out of the caucus someone who has tried to grab the gavel before.

We will see other veterans with plenty of institutional memory also announce they’re going to hang it up. Among those being whispered about, but yet to be confirmed, are House Majority Whip Gary Richardson, D-Hopkinton; House Transportation Committee Chairman Candace Bouchard, D-Concord; and Children and Family Law Committee Chairman Mary Beth Walz, D-Bow.

Manchester Democratic Rep. Jeff Goley, a popular centrist, is considered a big player for majority leader of the next Democratic regime.

But there are remaining Democrats who will give this chance at the brass ring a look.

Here are a few prospects who may be ready to jump through an opening if Shurtleff were to give them one:

Commerce Chairman Ed Butler, D-Hart’s Location. Butler, a seasoned committee leader, has the trust, if not the faith, of the business community and has the aura on the House floor of someone who never speaks unless he has something to say.

Judiciary Chairman Marge Smith, D-Durham. Yes, she has been a polarizing figure on the left at times, but she made groundbreaking improvements in transparency as Finance Committee chairman, and she comes from Norelli’s regional backyard.

Rep. Katherine Rogers, D-Concord. The former Merrimack County attorney is a savvy political operative who has physical limitations to standing in the well for hours on end but is a good nose counter.

Rep. David Cote, D-Nashua. A fiercely loyal Norelli backer, the chairman of House Election Laws could make a good deal for himself getting behind Shurtleff. With Campbell out of the picture, southern New Hampshire Democrats are looking for a stalking horse.

Let the bashing begin

The Telegraph’s Twitter feed first reported a staffer for the Democratic Senatorial Campaign Committee had sent an “important message” tweet that Sen. Jeanne Shaheen needs help against Republican Brown, the celebrated friend of Wall Street and Big Oil, as lead Democrats brand him.

We predicted at the time that it was just a matter of hours before the Senate Majority PAC (for Senate Democrats) would likely answer that frantic tweet calling for help for Shaheen with an ad buy.

Sure enough, by day’s end the Senate Majority PAC confirmed $221,000 in spots that would be “pro-Shaheen.”

Oh, really?

Here’s a portion of the Brown attack ad from the Senate Majority PAC:

“Scott Brown’s carrying some Big Oil baggage. In Massachusetts, he voted to give oil companies big tax breaks – they make record profits, he collects over 400,000 in campaign contributions. Now Brown’s shopping for a new Senate seat. In oil-rich Texas? The oil fields of North Dakota? Nope, Brown wants to bring his Big Oil baggage to New Hampshire. Scott Brown: out for himself and Big Oil at our expense.”

Now here’s a direct citation from the Shaheen campaign on the message section of its website.

“More attack ads. Paid for by the Koch Brothers and their special interest money. More proof big oil, the Koch Brothers and Wall Street think they can buy our Senate seat for Scott Brown.

“When Brown was the Senator from Massachusetts he gave big oil and Wall Street billions in special breaks. They gave him millions in campaign contributions. Jeanne Shaheen voted to stop those special breaks.”

Are you picking up any similarity here? The New Hampshire Republican State Committee and National Republican Senatorial Campaign Committee insist this amounts to illegal coordination.

As we tweeted last week, this frantic tweet tactic was used before similar Senate Majority PAC ads against Republican candidates for Senate in North Carolina and Alaska.

New Hampshire GOP leaders and Brown adviser Ryan Williams said this destroys Shaheen’s call for Brown to sign the “People’s Pledge” to ban outside money in this race.

“She has zero credibility on the topic now that we have seen this pathetic orchestration by the national party and the senator under siege to launch an air war,” Williams said.

Shaheen communications director Harrell Kirstein said Brown and his cohorts were allowed to engage in this outside spending against Shaheen for too long.

“Scott Brown’s Big Oil and Wall Street buddies have now spent $2 million, more than three times what Democratic groups have spent, attacking Jeanne Shaheen because they want Scott Brown back in the Senate voting to protect Big Oil tax breaks and savings billions for Wall Street,” Kirstein said.

Meanwhile, Politico didn’t get or agree with the memo that Brown is the only friend of Wall Street in this race.

Last week, it declared that Brown will have difficulty attracting the same level of backing from the financial powerhouses of the country because Shaheen has been a “friendly,” while Brown’s 2012 opponent, Massachusetts Democratic Sen. Elizabeth Warren, was a sworn enemy.

Shaheen has already received checks from PACs of banks and financial services trade groups, including Bank of America, Wells Fargo, American Bankers Association and Financial Services Roundtable.

Bank of America CEO Brian Moynihan gave Shaheen a $2,500 check in October after having donated to her opponent in 2008 – former GOP Sen. John E. Sununu.

“Senator Shaheen has actually always had a fairly close relationship with the financial industry, back to her time as governor,” said Stephen DeMaura, president of Americans for Job Security and former director of the New Hampshire Republican Party. “She’s a talented politician, people know her, she’s been around, she’s level-headed. All of these things the business community appreciates. So all of that means that it’s going to be a lot harder for Brown to raise the kind of money he raised from Wall Street last time.”

Kevin Landrigan can be reached at 321-7040 or