Panel Hears Technical Questions on HB 659 College Graduate Retention Incentive Program

A House committee took testimony on HB 659, a bill to establish the New Hampshire College Graduate Retention Incentive Program aimed at encouraging recent graduates to stay and work in the state.

The measure, introduced on behalf of sponsor Representative Sanjeev Manohar, would create incentives for employers to hire recent graduates and provide graduates with student loan forgiveness payments if they commit to working in New Hampshire for multiple years. Andrew Horn of Amherst, who testified on behalf of the sponsor in Manohar’s absence, told the committee the intent is to slow the state’s outflow of graduates and “incentivize people to stay here after they graduate.”

The most detailed technical testimony came from Lauren O’Sullivan, senior financial analyst at the Department of Revenue Administration (DRA). O’Sullivan told the committee she needs clearer bill language to determine how a benefit would be administered and counted for tax purposes. “Our question to this is, is this program intended to be a rebate or a credit and how would that work?” she asked, explaining the difference in DRA administration between a direct state rebate (paid by check after a claim is approved) and a tax credit (applied against liability on a return).

O’Sullivan noted additional technical consequences: if the program reduces the business enterprise tax (BET), that can also reduce the BET credit available to offset the business profits tax (BPT), with complex, non‑one‑for‑one interactions between the two taxes. “Any program reducing BET will also reduce the BET credit available to offset the business profits tax, thereby increasing the business profits tax revenue,” she read from DRA guidance.

Committee members pressed for detail about amounts and structure. Representative Damon asked about a discrepancy in the draft between $5,000 annual loan forgiveness and a $20,000 total cap, and Horn said the sponsor would likely clarify the intent and draft amendments. Representatives also asked whether public school districts or colleges receiving state grants would be eligible; Horn said the sponsor could refine language to clarify whether public school employers would qualify.

O’Sullivan said DRA assumes the Department of Business and Economic Affairs (DBEA) would administer the hiring rebate but needs the bill wording to be explicit. DRA told the committee it could absorb minor changes to tax forms and systems within existing staffing but could not speak for DBEA’s staffing needs.

The committee heard a brief public comment period and closed the hearing after additional technical discussion. No committee action or vote was taken during the hearing.

Next steps: The sponsor or his designee will be expected to return with clarified language that addresses DRA’s technical concerns about whether benefits operate as rebates or credits, the effective tax years for the program, and administration and cap mechanics.