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Bill would let towns adopt optional reduced default budget in SB2 elections
Summary
House Bill 613 would let towns or school districts that use the official ballot (SB 2) form of meeting adopt an option allowing voters to choose a reduced default budget percentage if the proposed operating budget fails.
Representatives heard House Bill 613, introduced by Representative Juliet Hervey Bolia, which would allow political subdivisions that use the SB 2 (official ballot) form of meeting to adopt a local option enabling a reduced default budget if voters reject a proposed operating budget.
Under the bill, a municipality or school district could adopt, by three‑fifths vote, a mechanism that presents voters on the ballot with an annual choice: accept the default budget or accept a reduced default budget computed by applying a locally adopted percentage reduction (between 0 and 10 percent) to the default calculation. If voters adopt the reduced default option, it would apply in years when the proposed operating budget fails and the default budget would otherwise take effect. The local adoption would be reversible by a three‑fifths vote.
Supporters including Eric Power, who said localities have increasingly seen default budgets that closely match proposed budgets and that the optional reduced default would give voters another tool when they disapprove of proposed spending. Proponents argued the option could encourage more prudent budgeting and give communities a way to constrain growth in default outcomes.
The New Hampshire Municipal Association opposed the measure in its current form, saying default budget calculations exist to ensure municipalities can meet contractual obligations (collective bargaining, debt service, mandated services) and that the proposed percentage reduction could arbitrarily undermine the ability to fulfill legal obligations. NHMA noted that RSA 40:14–b already allows a budget committee to propose an alternative default budget, and warned the proposed local option could be used repeatedly year after year with cumulative effects on a community's ability to pay obligations.
Committee members pressed witnesses on scenarios in which a fixed percentage reduction could make it impossible to meet legal obligations such as collective bargaining agreements, and on whether the bill would change thresholds for adoption or rescission. No committee vote occurred during the hearing.
