From BPT cut to housing, modest success seen on some key issues

From a business perspective, the past legislative session was not the best of times nor the worst of times. But it didn’t start out that way.

“Honestly, most of the time we were playing defense,” said David Juvet, senior vice president of public policy at the Business & Industry Association. “I think it ended up a much better session for employers than we initially thought going in.”

While many Democrat-sponsored bills were relatively easily fended off — including measures to increase the minimum wage, to require more advance notice of schedule changes and to make sure discharged workers don’t lose their vacation time — they were easily defeated by a Republican-dominated Legislature.

But business groups were not used to fighting off regulation from Republicans, including many anti-vaccination bills that tried to prevent businesses from requiring that workers get vaccinated or wear masks.

“This a different kind of Republican party,” said Juvet. “Rather than focusing on what’s best for employer, its more about what’s best for the individual.”

But several pieces of legislation did pass that business groups were interested in. Here are the key measures that made it through.

Taxes

Juvet called “modest” a tax cut contained in House Bill 1221. Perhaps that may have been understatement. The reduction — a business profits tax rate cut from 7.6 to 7.5 percent — would cut by $1,000 the tax bill of a company with $1 million profit. Most of those savings next year will be go to larger out-of-state businesses. (While it is true that most BPT taxpayers are local, the bulk of the tax is paid by the minority that’s out of state.)

But most New Hampshire businesses are more likely to pay the business enterprise tax, and there will be no cuts for them this year. That was “a little bit of a disappointment,” said Bruce Berke, state director for the National Federation of Independent Business in New Hampshire. A cut in the BET rate — from 0.55 to 0.5 percent of wages, interest and dividends paid — was originally included in HB 1221, but it was axed after opponents raised concerns about its effect on the budget, which would have been about three times larger than the BPT cut.

Larger taxpayers with businesses in multiple states will also benefit from Senate Bill 435. This ends a practice unique to New Hampshire that required multistate companies to apportion net operating loss deductions (NOL) twice, which “basically renders NOL virtually meaningless,” said Juvet. He added that the bill “was helpful to a small number of companies.”

According to the state Department of Revenue Administration, those companies would save about $4.5 million a year.

Healthcare

At the beginning of the year, there were dozens of bills seeking to prohibit mandating Covid vaccines and other health measures, such as masking, and many were aimed at businesses themselves. None of the bills directly impacting businesses passed, and many of the bills that did pass were watered down so much as to be meaningless.

For instance, HB 1455, introduced by House Speaker Sherm Packard, sought to prohibit state enforcement of federal vaccine mandates, but it exempted health facilities, the only business under a federal mandate. Similarly, HB 1495 sought to prohibit the state from mandating that businesses require vaccinations, but the state has no intention of doing that, and it does not prevent businesses on their own to require vaccinations.

Perhaps the biggest change when it came to vaccines came in HB 1606, which requires individuals to opt in to join the vaccine registry, a bill strongly opposed by the NH Hospital Association, but the governor wound up signing it.

The Association also strongly opposed HB 1022, which would have allowed pharmacists to dispense ivermectin pursuant to a standing order. Ivermectin has not been approved by the Federal Drug Administration for the treatment of Covid, but was taken with much fanfare by former President Trump when he contracted the disease. Sununu vetoed the bill.

Lawmakers did pass SB 229 which permits certified pharmacy technicians to administer vaccines.

Another bill that came out of the pandemic experience was HB 1439, which gives patients the right to appoint someone to be present while getting care, and SB 412, which appropriates $5 million to increase nursing home rates, both bills supported by the Hospital Association.

But the biggest health bills had nothing to do with Covid.

HB 103 and SB 422 adds dental in Medicaid benefits for the first time, though unlike other Medicaid services, there will be co-pays and deductibles.

Real estate and construction

There was a big bipartisan effort in support of SB 400, the workforce housing “community toolbox” bill, but it failed in the House, was revived in the Senate and its language was tucked into HB 1661, the biggest omnibus bill of the session, although many of its popular provisions among developers and affordable housing advocates were taken out in the conference committee.

Still, the language that requires planning and zoning boards to give a reason for denial of a development. If they don’t, the project is automatically approved. The new law does speed up some deadlines and provides some funds for training, and allows communities to include housing existing property tax incentives for commercial developers.

“It speeds up the process. The old adage, ‘the quicker to get a decision, the better for all involved,’” said Bob Quinn.

The bill “moves the needle,” said Matt Mayberry of the Home Builders Association of New Hampshire. “This may not be everything we want on day one, but it’s a step forward, not back.”

While SB 400 got all the attention, three bills having to do with building codes might have more of an impact.

New Hampshire lawmakers have been tinkering with building codes for years. Not only have the codes been outdated, but some localities have passed their own code updates, sometimes driving developers crazy and also driving up the cost of housing, since insurance is expensive when codes are so out of date.

SB 443 addresses the local code issue by requiring municipalities to submit their changes to the building code review board, to see if they are in line with the latest statewide code and to publish all the variations in one place to make it easier for builders.

HB 1681 updates the state building code to the national code of 2018 (it had been the 2015 code), so the state will be roughly one code behind the times (they are updated every three years). “Let other states work out the kinks,” said Mayberry.

And SB 398 sets up a committee to study the next code, so the state will be able to adopt them quicker the next time.

Other housing bills under the radar included SB 210, which makes it easier for cooperatives to vote on whether to buy a park they are living in, the first major change in a law that has led to more than 140 tenant-run cooperatives in the state.

There was also SB 371, which replenishes the $3 million Lead Paint Hazard Remediation Fund, which provides interest-free loans to landlords to help remove lead on their property. That fund has financed lead removal at some 800 rental units in the past.

When it comes to commercial construction, perhaps the most important bill was SB 401, which spends some $70 million in state surplus money on municipal bridges ($36 million) and roads ($30 million), with an additional $4.1 million for the road needed to renovate The Balsams resort in Dixville.

Manchester, for instance, will get $6 million out of the deal, Nashua $3.1 million and Concord $2.7 million, said Gary Abbott, head of Associated General Contractors of NH.

Energy

The clean energy industry also seemed under assault at the beginning of the year, but “we played a good game of defense,” said Kelly Buchanan, director of legislative and regulatory affairs for Clean Energy NH, in a webinar.

Perhaps the biggest defensive move came after an action by the Public Utilities Commission to gut funding for the utilities’ energy-efficiency programs through NHSaves. HB 549 not only reversed the PUC decision, maintaining the programs, but even modestly increased the system benefits charge on monthly electric bills.

“Some 600 small construction companies were affected. We were one of those leading the charge,” said Mayberry of the Homebuilders Association. The result was a unanimous roll call vote in the House as well as a voice vote in the Senate. “You can’t get a 343-to-0 vote for a birthday resolution.”

Yet the victory was “bittersweet,” said Sam Evans-Brown, executive director of Clean Energy NH, since the PUC, once an advocate of clean energy, “can’t help but monkey around with it.”

The bill also gives lawmakers a future say in SBC surcharges. That used to be a detriment, but with the PUC changing from a clean energy advocate to a skeptic, “that is a little bit less of a concern,” said Evans-Brown.

SB 262 was another half a loaf. The bill originally would have allowed businesses to increase net metering projects from one to five megawatts, a provision that Sununu has vetoed in the past.

The original version didn’t make it, two provisions in it did. One says the Department of Energy must come up with a program to standardize utility interconnection fees, which vary considerably, and another tweak that allows municipal projects (not businesses) to benefit from two renewable energy programs at once.

Also, SB 321 could help businesses participate in large-scale solar projects. While they can’t benefit from net metering, they can get discounts based on the time they use their energy. This is a big deal, said Evans-Brown, since it goes beyond net metering and is a stepping stone toward aligning cost of power to the modern grid.

Also signed into law were bills to help develop offshore wind and renewable natural gas.

The wind bills, SB 268 and SB 440, set up a legal framework in the event that a project should ever be located along New Hampshire’s shoreline. Similarly, SB 424 would allow utilities to spend ratepayer money to develop renewable natural gas.

And there is SB 271, which keeps keep the Burgess Bipower plant in Berlin going for another year. Critics of the plant and the bill opposed ratepayer subsidies to the plant, but supporters maintained that the plant is one of the larger generators in the state, is a crucial customer for low-grade wood, and is a renewable and reliable backup with energy costs skyrocketing. This was a major win for NH Timberland Owners Association.

Other measures

• Broadband: More money will be going into broadband infrastructure, but SB 445 no longer specifies how much. Earlier versions of the bill indicated $122 million, all of it federal. That number is still in the fiscal note but not in the bill’s text. The bill does say the state should pay 75 percent of a project’s cost if municipalities, or a private company, chip in 25 percent, up from the 50-50 match in the original bill. Some of those broadband funds could be used to enhance cellphone service, thanks to SB 395 (though the feds have to go along with it).

• Cryptocurrency: HB 1503 updates the Uniform Commercial Code to include “controllable electronic records,” more commonly known as cryptocurrency, to exempt it from various security laws starting next year and to provide a framework to jump-start the industry here. HB 1503 also includes language that requires the state to give the bidding edge to contractors that use domestic still on projects of over $1 million.

• Advanced recycling: SB 367 boosts advanced recycling by exempting the process of melting down plastics to be molded into new plastics from the solid waste laws, treating it more like a manufacturing process. The technology still has a way to go since recycled plastics are so varied, and the energy needed to produce it may not be cost effective.

• Keno: HB 355 expands keno games to grocery stores (primarily convenience stores) in areas that have already approved it. It can be another source of income for stores, since they receive an 8 percent cut of sales.

Bob Sanders can be reached at bsanders@nhbr.com.