HB 269-FN – AS INTRODUCED
2011 SESSION
05/10
HOUSE BILL 269-FN
AN ACT establishing a priority based budget system focused on measurable results.
SPONSORS: Rep. Bowers, Sull 3; Rep. Mirski, Graf 10; Rep. Avard, Hills 20; Sen. White, Dist 9
This bill:
I. Directs state agencies to develop a performance measurement system for agency programs that may be used in determining budget priorities.
II. Requires the governor to present the proposed budget in order of funding priority.
III. Establishes a budgetary spending limit based on actual revenue from the prior fiscal year.
IV. Establishes a committee to define the strategic priorities of government.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
11-0586
05/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eleven
AN ACT establishing a priority based budget system focused on measurable results.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Section Budget and Appropriations; Limitation on Spending. Amend RSA 9 by inserting after section 2 the following new section:
9:2-a Limitation on Spending. Expenditures in any year shall not exceed actual revenue for the previous year. The governor shall not propose nor shall the general court adopt a budget for the ensuing year in which expenditures exceed estimated revenue for the current year. When actual revenue is reported for the current year, the governor shall recommend adjustments to the approved budget.
2 Form and Contents of the Governor’s Budget. Amend RSA 9:3, I(a) to read as follows:
(a) The governor’s program for meeting all the expenditure needs of the government for each of the years of the biennium to which the budget relates, presented in order of funding priority and indicating the classes of funds, general or special, from which such appropriations are to be made and the means through which such expenditures shall be financed;
3 Form and Contents of Governor’s Budget. Amend RSA 9:3, I(c) to read as follows:
(c) [If the estimated revenues of the state for the ensuing biennium as set forth in the budget on the basis of existing laws, plus the estimated amounts in the treasury at the close of the year in progress available for expenditure in the ensuing biennial period is less than the aggregate recommended for the ensuing biennial period as contained in the budget, the governor shall make recommendations to the legislature in respect to the manner in which such deficit shall be met, whether by an increase in the state tax or the imposition of new taxes, increased rates on existing taxes, or otherwise; and] If aggregate expenditure requests exceed the spending limit of RSA 9:2-a, the governor shall recommend which items in the prioritized list of requests shall be funded and which shall not be funded. If the aggregate of [such] estimated revenues of the state for the ensuing biennium as set forth in the budget on the basis of existing laws, plus estimated balances in the treasury is greater than such recommended appropriations for the ensuing biennial period, the governor shall make such recommendations in reference to the application of such surplus to the reduction of debt or otherwise, to the reduction in taxation, or to such other action as in the governor’s opinion is in the interest of the public welfare. The governor’s operating budget shall not use bonded indebtedness to fund operating appropriations. Nothing contained herein shall prohibit the use of projected lapses in determining compliance with this section.
4 Requests for Appropriations and Statement of Objectives. RSA 9:4 is amended to read as follows:
9:4 Requests for Appropriations and Statement of Objectives.
[I.] On or before October 1 prior to each biennial legislative session, all departments of the state shall transmit to the commissioner of administrative services, on blanks to be furnished by the commissioner, [estimates of their expenditure requirements] expenditure requests for each fiscal year of the ensuing biennium, presented in order of funding priority based on the performance measurement system developed under RSA 9:30, for administration, operation, [maintenance expenditure,] and program services, including costs for workers’ compensation and unemployment compensation. In case of the failure of any department to submit such [estimates] requests within the time above specified, the commissioner of administrative services shall cause to be prepared such [estimates] requests for such department as in the commissioner’s opinion are reasonable and proper.
[II. In this section “maintenance expenditure” means:
(a) The cost of providing the same level of service authorized and funded in the preceding fiscal year, incorporating changes in the population, economic conditions, and other factors outside the control of the PAU. The governor shall provide criteria for the development of maintenance expenditures which may include the following:
(1) Any increases or decreases in the cost of purchased goods or services due to general price changes in the economy at large;
(2) Salary steps within grade;
(3) New positions necessary to provide the same level of service;
(4) Additional operating costs associated with previously authorized capital improvement projects to be completed during the biennium;
(5) Reductions for non-recurring costs of the prior fiscal year.
(b) The maintenance level shall not include new programs or changes in the kind, quantity, or quality of service when the change is at the agency’s discretion or is the result of changes in federal or state law or regulation.
(c) Within the meaning of this section, the governor shall make the final determination as to whether a particular cost shall be deemed to be a maintenance expenditure.]
5 Tentative Budget; Reference to Expenditure Requests. Amend RSA 9:6 to read as follows:
9:6 Tentative Budget. Upon the receipt of the [estimates of expenditure requirements] expenditure requests called for by RSA 9:4 and the preparation of the estimates of income called for by RSA 9:5, and not later than November 1 next succeeding, the commissioner of administrative services shall cause to be prepared a tentative budget conforming as to scope, contents, and character to the requirements of RSA 9:3 and containing the [estimates of] expenditure requests and revenue as called for by RSA 9:4 and RSA 9:5, which tentative budget shall be transmitted to the director of the budget for submittal to the governor. The tentative budget shall comply with the requirements of RSA 9:9-b. The budget shall be made available in printed format and in at least one electronic computer file format in common use at the time. The sections of the budget that state: gross appropriations from the highway fund, the highway block grant aid appropriation, the highway fund appropriation to the department of safety, and highway fund appropriations that are transferred to other agencies that comply with part II, article 6-a of the New Hampshire constitution relative to the use of highway funds, shall be reported to the president of the senate, the speaker of the house of representatives, and the chairmen of the house and senate standing committees on finance.
6 Formulation of Budget Based on Expenditure Requests. Amend RSA 9:8 to read as follows:
9:8 Formulation of the Budget. Following his or her inauguration, the governor shall proceed to the formulation of the budget provided for by RSA 9:2 and 3. In doing so [he] the governor shall give such weight to the estimates of income as prepared by the commissioner of administrative services and to the [estimates of expenditure requirements] expenditure requests as submitted by the departments and to the testimony elicited at the hearings thereon as he or she deems proper, but the proposals contained in the budget shall represent [his] the governor’s judgment and recommendations in respect to the provision to be made for meeting the revenue and expenditure needs of the state for each of the fiscal years of the ensuing biennium.
7 Adoption of Operating Budget; Prioritization of Expenditure Requests.
9:8-b Adoption of Operating Budget. [The general court shall not adopt an operating budget for any fund, or any other legislation which provides for appropriations, which exceed the state’s total estimated revenues from existing, increased, or new taxes, fees, operating income and other sources. If the estimated revenues of the state for the ensuing biennium as set forth in the budget on the basis of existing laws, plus the estimated amounts in the treasury at the close of the year in progress available for expenditure in the ensuing biennial period is less than the aggregate recommended for the ensuing biennial period as contained in the budget, the general court shall adopt a budget in which such deficit shall be met, whether by an increase in the state tax or the imposition of new taxes, increased rates on existing taxes, or otherwise; and] If aggregate expenditure requests exceed the spending limit of RSA 9-2-a, the general court shall determine which items in the prioritized list of requests shall be funded and which shall not be funded. If the aggregate of [such] estimated revenues, plus estimated balances in the treasury is greater than such recommended appropriations for the ensuing biennial period, the general court shall adopt a budget applying such surplus to the reduction of debt or otherwise, to the reduction in taxation, or to such other action as is in the interest of the public welfare. Such operating budget shall not use bonded indebtedness to fund operating appropriations. Nothing contained herein shall prohibit the use of projected lapses in determining compliance with this section.
8 New Subdivision; Priority Based Budget System. Amend RSA 9 by inserting after section 28 the following new subdivision:
9:29 Committee to Define the Strategic Priorities of Government Established.
I. There is established a committee to define the strategic priorities of government.
II. The members of the committee shall be as follows:
(a) Three members of the house of representatives, appointed by the speaker of the house of representatives.
(b) Three members of the senate, appointed by the president of the senate.
III. Members of the committee shall receive mileage at the legislative rate when attending to the duties of the committee.
IV. The goal of the committee is to study and make recommendations to the general court on the core functions of government so that the general court may make budgetary decisions on the basis of agreed-upon priorities. The committee shall determine what functions of state government are required by the constitution of New Hampshire and what services provided by state government are essential to the citizens of this state. Recommendations made by the committee under this paragraph may include:
(a) Protecting people and communities through law enforcement, courts, and corrections;
(b) Requiring state agencies to conduct business in an efficient, transparent, and accountable manner;
(c) Encouraging job creation and entrepreneurship by removing regulatory barriers to job production;
(d) Providing for an educated citizenry by ensuring that all children receive an equal opportunity to achieve academic success;
(e) Providing a safety net of social services;
(f) Building and maintaining the infrastructure to accommodate transportation and utilities; and
(g) Managing public property and natural resources, including protections for air, water, and soil, while protecting property rights of private property owners.
V. The members of the committee shall elect a chairperson from among the members. The first meeting of the committee shall be called by the first-named house member. The first meeting of the committee shall be held within 45 days of the effective date of this section. Four members of the committee shall constitute a quorum.
VI. On or before November 1, 2011, the committee shall report its findings and any recommendations for proposed legislation to the speaker of the house of representatives, the president of the senate, the house clerk, the senate clerk, the governor, and the state library.
9:30 Adoption of Performance Measurement System by Agencies.
I. On or before October 1, 2011, every agency shall adopt a performance measurement system for each of its programs that includes: a mission statement, the outcomes the program seeks to achieve, and the specific outcome indicators that the program intends to use to track performance.
II. Each department shall use the performance measurement system in submitting budget expenditure requests under RSA 9:4 and shall prioritize requests in terms of how effectively and efficiently each program contributes to the government’s strategic priorities. Each expenditure request shall be presented in order of funding priority.
9:31 Performance Audit and Reporting Requirements.
I. On or before October 1, 2011, each agency shall submit an initial report on the development and adoption of a performance measurement system under RSA 9:30. The report shall specifically identify the performance measures developed pursuant to RSA 9:30 and shall report on those measures to the extent of the available data. Copies of the report shall be forwarded to the speaker of the house of representatives, the president of the senate, the governor, the house clerk, the senate clerk, and the state library.
II. Beginning October 1, 2012, each agency shall submit an annual report of its performance based on the performance measurement systems developed under RSA 9:30. The report shall be submitted to the speaker of the house of representatives, the president of the senate, the governor, the house clerk, the senate clerk, and the state library.
9 State Economic Growth, Resource Protection, and Policy Planning; Report to Governor and General Court; Reference Change. Amend RSA 9-B:6, I to read as follows:
I. Progress by state agencies in complying with the expenditure [requirements] requests under RSA 9-B:4.
10 Pease Development Authority Budget Request; Reference Change. Amend RSA 12-G:32 to read as follows:
12-G:32 Operating Budget. The authority shall comply with the requirements of RSA 9:1 through 9:9, relative to the budget. The authority shall include in its biennial estimate of the expenditure [requirements] requests of the division of ports and harbors a separate line item titled “Reimbursement to Pease Development Authority for Services” and request a reasonable estimated amount to cover such costs as necessary.
11 Effective Date. This act shall take effect upon its passage.
LBAO
11-0586
Revised 08/23/11
HB 269 FISCAL NOTE
AN ACT establishing a priority based budget system focused on measurable results.
FISCAL IMPACT:
The Office of Legislative Budget Assistant is awaiting information from the Department of Administrative Services relative to the potential fiscal impact of this bill. The Department was initially contacted on 01/06/11 and most recently contacted on 06/12/11.