LEBANON — Negotiators are closing in on a budget deal that would increase state education aid without raising taxes, Gov. Chris Sununu said on Monday.
“We are very close to getting a budget done. We’re really close,” the two-term Republican told a crowd at the Upper Valley Senior Center.
Sununu said he met with Democratic lawmakers Monday morning and offered to invest an additional $131 million in education.
If accepted, the compromise would come just $7 million short of the Legislature’s $138 million education plan proposed earlier this year.
“It’s pretty much everything the (Legislature) wanted,” Sununu said. “We found an innovative way to do it without raising taxes.”
But the governor’s funding proposal isn’t all its chalked up to be, according to Democrats who argue the plan wouldn’t direct as much aid to property-poor communities as their spending plan. Sununu also declined to say how he would pay for the education spending, leading some lawmakers to warn of cuts from elsewhere.
Senate Majority Leader Dan Feltes, D-Concord, said Sununu previously threatened cuts to social services during talks with lawmakers, and is now eyeing them again.
“He’s proposing to slash $158 million of the budget,” including cuts to health care, day care and education programs, said Feltes, who is running for governor. “All for tax breaks for large, out-of-state corporations.”
Sununu cited the inclusion of “job killing tax increases” as reason to veto the Legislature’s budget in June. The two-year spending plan, which received no Republican support, sought to roll back planned business tax cuts to pay for more education spending, as well as $40 million for unrestricted money for towns and cities that would come through a revenue sharing program.
Without the business taxes, it appears the governor will pull from a revenue surplus generated by the recent Trump tax cuts for businesses, said state Rep. Susan Almy, D-Lebanon, who chairs the House Committee on Ways and Means.
“That surplus is out there but we aren’t sure how big it is yet,” she said in a phone interview on Monday.
Almy said businesses are already projecting lower tax payments for this year, and without a concrete source of funding, many of Sununu’s proposed education funding goals could be cut from future budgets.
Neither Almy nor Feltes are involved in direct talks with the governor, but both have received briefings on the negotiations.
Sununu’s proposal includes a $71.4 million increase in “ongoing aid categories,” such as funding for full-day kindergarten, as well as an additional $60 million for school infrastructure grants, according to Ben Vihstadt, the governor’s spokesman.
“School boards would be empowered to spend the money on projects they determine, like school building upgrades, etc.” Vihstadt wrote of the infrastructure grants in an email.
The compromise is nearly identical to a plan Sununu floated to New Hampshire school districts in an Aug. 29 letter, which breaks down his $71.4 million figure.
The letter calls for a $14 million rise in stabilization grants, $25 million more for “disparity aid” and $18 million in additional full-day kindergarten funding.
Overall, Sununu’s plan would provide Claremont with an additional $3.56 million in state education aid over the next two years. Canaan would see an $546,879 and Lebanon would get $837,590 under the same arrangement.
In some cases, those amounts are almost half of what the Legislature proposed in its budget.
Democrats sought to give Claremont $6.2 million in new funding, while Canaan would get $847,676 and Lebanon would see $947,879 in new money over the budget’s two-year lifespan.
A demand for those funds drew about 25 protestors to confront Sununu outside the senior center on Monday. Holding signs that said “Veto Sununu,” “Sign the Budget!!!” and “Stop the Vetoes,” they encouraged the governor to compromise with the Democratically-controlled Legislature.
“Please fund the budget,” one protestor yelled as Sununu walked past while exiting the event.
“Unfreeze schools,” shouted another. “Fund the budget! Fund the schools!”
Sununu responded by saying that his funding proposal met “99.7%” of Democrats’ education funding demands.
“Good deal?” he asked the crowd, which largely responded with skepticism.
Chuck Townsend, a former Democratic lawmaker from Canaan, said he joined the protest to draw attention to education funding. Cuts to state aid have resulted in “terribly high property taxes” throughout the Mascoma Valley, whose five towns share a school district, he said.
“I do want us to have a budget instead of hanging out without one,” Townsend said. “I wish (Sununu) would agree to a compromise budget instead of being so single minded.”
Under state law, lawmakers, who have so far been tightlipped on negotiations, have until the end of the month to enact a budget.
Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.