Mayor Guinta "deeply troubled" by Governor's Office response to the downshifting of costs to municipalities

MANCHESTER (February 13, 2009) – Manchester Mayor Frank Guinta is disappointed in the dismissive response from the Governor’s Office to the concerns of New Hampshire municipalities, which bear the brunt of his biennial budget proposal. The proposal strips from communities revenue sharing funds as well as a share of the rooms and meals tax in exchange for federal funds that may be coming to the state in the form of the proposed stimulus package.


“I am deeply troubled that the Governor’s Office does not understand the real problems that this budget proposal lays on the backs of the cities and towns of New Hampshire,” Guinta said. “In his budget, Gov. Lynch asks communities to forego funds that they have used as part of their budget for nearly 40 years. In exchange, he is asking them to use one-time ‘stimulus to cover the revenue shortfall. For the Governor’s Office to dismiss these concerns with the phrase ‘It’s a trade-off’ shows shocking ignorance about their own budget proposal and its consequences. Assuming federal funds arrive on time, as promised by the Governor, there remains no plan for replenishing those funds in the following biennium.”


Yesterday, Guinta revealed that the proposed budget would create a $9.6 million revenue hole in the city’s FY10 budget and a $2.4 million deficit in the current FY09 budget. In speaking with the New Hampshire Municipal Association (NHMA) and other local officials, Guinta said he is not alone in his concern. He is also calling for a meeting of the other New Hampshire mayors to discuss the ramifications of the state budget on their budgets. Gov. Lynch’s proposal alone would raise taxes by 4 percent.


“If you hear what other local officials are saying, they also share my fears,” Guinta said. “The NHMA called this ‘quite a hit’ for cities and towns to have to swallow, and officials of various types of local governance and political persuasions feel the same way. Many of these communities have already crafted their budgets, believing that the state aid funds would be available, so the chaos it creates at the local level is real.”


Mayor Guinta reiterated that if the Governor is so sure that federal stimulus money is coming, then he should apply them to his proposal and keep the current system in place.


“There is no concrete timeline when – or if – these funds are coming to the state or how much the state is receiving in funds. In addition, there are no formal guidelines on what strings are attached to these funds. And, most importantly, there is no guarantee that these funds will be sustained beyond 2009. However, we are being asked to trust that these funds will make local budgets whole. I am extremely skeptical about this; but if Gov. Lynch has faith in these funds, they should be applied to his budget proposal. Let his budget take the risk and keep the current funding mechanism for the communities.