Legislative Halftime 2021: A Strange and Difficult Year

The information contained in this article is not intended as legal advice and may no longer be accurate due to changes in the law. Consult NHMA's legal services or your municipal attorney.

It’s no surprise that the 2021 legislative session has been a strange one. The pandemic has necessitated social distancing measures, meaning that in-person meetings and lobbying haven’t occurred. Instead, NHMA’s staff has spent hours on Zoom, Teams, and YouTube speaking with legislators and allies, and watching the legislature hold committee hearings and sessions. These have stretched to five days a week, despite few House or Senate sessions being scheduled; and we’ve probably been busier than ever switching from hearing to hearing.

Unfortunately, attending all these hearings has been necessary because we’ve seen a large number of bills filed that are major threats to municipalities. As of this writing, we have not yet seen the outcome of the three-day marathon House session in early April, but we do know that a large number of previously non-partisan subjects have become partisan, and both parties have been consistently voting along party lines. We’ve seen nothing to indicate that pattern won’t continue at the House session. We expect that most bills recommended as “Ought to Pass” by the majority party in committee will be bills passed, and those recommended as something other than “Ought to Pass” will be delayed or killed by the full House.

All of this has made it a very difficult year as party membership has seemingly played a more important role than the individual merits of any given bill. For example, we saw committee recommendations of “Ought to Pass” or “Inexpedient to Legislate” along party lines on bills as diverse as: HB 439, repealing the authority of city and town councils to adopt ordinances “which may seem for the well-being of the city” (an authority that has been in place since 1846) (OTP); HB 374, changing the process for adopting the official ballot referendum (SB 2) form of town government (a process that was changed just last year) (OTP); HB 266, prohibiting municipalities from adopting any policy that restricts or discourages “inquiring about the immigration status of any individual” (rather than continuing to allow police chiefs and local officials to adopt the policies they believe are best suited to their cities and towns) (OTP); HB 588, requiring every municipality with a zoning ordinance to allow “tiny houses” in all residential districts (ITL); HB 341, requiring municipalities to allow every single-family dwelling in a residential district that is served by municipal water and sewer to be configured as a four-unit building (ITL); HB 216, one of several popular bills that would allow municipalities – and other governmental entities – to hold meetings remotely (ITL). For many of these, we simply can’t understand why they’re partisan issues, and our fellow lobbyists are similarly flummoxed when we’ve asked them about bills that they’ve been following.

Meanwhile, the budget process has kicked into high gear. As of this writing, it’s too early to tell how the final budget will turn out, but we are concerned. The impending flood of money from Washington has coincided with a number of amendments in Concord to restrict state funding. Perhaps most worrisome as of this writing was the House Finance Committee vote of “Ought to Pass” on amendments to eliminate the total amount of state aid grant (SAG) appropriations from the governor’s budget for the biennium ending June 30, 2023. As it’s unclear whether the money from Washington can be used for the same projects as the SAG appropriations, municipalities could be facing huge bills to fill the statutory obligation of the state to help pay for needed water pollution control infrastructure.

On the other hand, in the Senate, four important state aid and revenue sharing bills have been placed on the table. The most significant bill is SB 99 to repeal the meals and rooms tax catch-up formula for distribution and return the municipal share to the statutory 40%. There has been considerable discussion about providing needed property tax relief to New Hampshire residents, and Senators’ desire to include funding from these four bills in the budget to achieve that purpose is at least hopeful. The Senate will have its opportunity to craft relief when it receives the budget from the House.

In addition, there seem to be an unusually large number of amendments in the budget trailer bill (HB 2) that do not pertain to budgetary matters. For example, the Finance Committee voted to include the text of HB 544, prohibiting the “propagation of divisive concepts,” as an amendment to HB 2, the budget trailer bill. While it is still unclear whether the full House will go along with such inclusions, this change is particularly troubling. It’s also a change that’s concerning because unlike an ordinary bill, there’s often little-to-no notice of the amendment, no opportunity for a public hearing, and little time to speak to legislators about it before they vote on it.

While there are many bills (and amendments) of concern, HB 111 has generated the most member interest this session. HB 111 is, with minimal changes, a model bill drafted by an out-of-state libertarian organization and purports to eliminate “qualified immunity”; but HB 111 goes far, far beyond eliminating qualified immunity. It states that in a lawsuit against a governmental “agent,” it will be no defense that the agent “could not reasonably or otherwise have been expected to know whether the such [sic] agent’s conduct was lawful,” or that the agent “acted in good faith, or . . . believed, reasonably or otherwise, that his or her conduct was lawful at the time it was committed.” In essence, it imposes strict liability on local officials and employees for any injury that results from their conduct, no matter how reasonable the conduct was. That liability is, in turn, imputed to the municipality. In any case in which the plaintiff prevails, the municipality would be liable for all attorney fees and litigation costs. To say that this would be disastrous would be an understatement.

In addition to HB 111, we’ve seen budget-related bills that trouble us greatly. For example, CACR 9 is a constitutional amendment that would starve municipalities of revenue by prohibiting them from raising property tax revenues by more than two percent in any year. The limit would be “based on the actual tax of the previous year and not the rate.” In other words, a town could not increase the total amount of revenue raised from taxes by more than two percent per year, even if some significant property use change occurs during the course of the year, such as the building of a large commercial facility that would ordinarily produce more tax revenue than is allowable under this formulation. Also in the realm of municipal finance, HB 243 would require municipalities to take numerous undefined actions with respect to their budgets. For example, HB 243 requires that all budgets be prepared in “full line item detail,” but the phrase “full line item detail” is not defined. The bill also requires the governing body to “publish” the “draft budget and revised versions, after making any updates to the budget,” within 5 days, in both CSV and PDF electronic formats.

NHMA has been steadfastly opposing these and other bills that would do harm to municipalities, while championing those that would make municipal governance easier.  As in every year, we’ve also been relying on our members to contact their legislators to express their concerns—and approvals—of bills winding their way through the legislature. The best way to keep up to date on our activities and the activities of the legislature is to subscribe to our Legislative Bulletin.

We publish every Friday during the legislative session, and it’s a critical tool to help us let you know what’s going on in Concord and where we need your help. If you haven’t yet subscribed to receive the Bulletin every Friday, please do so. And, while we still publish a paper version, please keep in mind that the problems at the United States Postal Service and legislative committees’ tendencies to hold hearings on Monday mornings mean that those who receive the paper version are likely to receive the news of the upcoming week’s events after they’ve already occurred. Subscribing to the emailed version of the Bulletin is the best way to stay informed and ensure that you have the opportunity to voice your opinion at the legislature.