Budget conference hears revised revenue estimates; committee adopts updated insurance tax figures

The Committee of Conference on House Bill 1 and House Bill 2 on June 8 heard updated revenue estimates from the Department of Revenue Administration and the New Hampshire Insurance Department and reached a tentative agreement to adopt new insurance premium tax figures that raise the FY2025 base and increase projected receipts for the coming biennium.

The Department of Revenue Administration (DRA) presented a set of ranges based on data through May, showing a narrower but still substantial spread in projected receipts depending on how June collections — a large month for business tax estimate payments — ultimately perform. "With May data, we have 11 out of the 12 months. So at this point, we're really only estimating June," Commissioner Lindsey Stepp said, explaining DRA's practice of using the current fiscal year as a base and applying growth rates to produce low and high scenarios.

Why it matters: lawmakers must agree on an agreed revenue baseline before they can finalize spending in HB1 (the operating budget) and HB2 (policy and dedicated funds). Small changes in revenue assumptions translate into millions of dollars available for programs, reserve ("rainy day") deposits or back-of-budget reductions.

DRA highlighted that business taxes are the single largest source of uncertainty. Stepp described a range of plausible year-over-year growth for business taxes from roughly 2% on the low end to 8% on the high end, driven by factors including recent estimated-payment adjustments by firms, federal tariff discussions and potential shifts tied to U.S. tax policy. Representative McGuire pressed DRA on the source of the growth assumptions; Stepp said the ranges come from scenario runs that compare current performance to prior-year results and to plan.

The insurance premium tax (IPT) projections became a focal point. DJ Bettencourt, commissioner of the New Hampshire Insurance Department, described why the insurance estimate supplied to the House in January was conservative and why the department revised it upward after seeing stronger-than-expected filings and earlier real-time electronic reporting. "We began to get an indication that the hard market . . . was not playing out as we typically would see," Bettencourt said, and that the department adjusted its call after national conversations with peer regulators and new data availability. Amy Duham, who leads the department's IPT unit, told the committee: "We're expecting probably $1.75 to $176,000,000 at the end of the fiscal year." That contrasts with the House number for FY2025 of $150 million that had been set earlier in the session.

House and Senate members described how differences in timing and methodology produced diverging baselines: the Senate started its FY2025 base about $40 million higher on business taxes than the House and recommended higher growth rates in later years; the House favored more conservative near-term growth. Senator Lang argued the Senate's higher baseline reflected more current data and expected economic improvement; Representative DeGioia and others urged caution because fiscal year 2026 begins in weeks and the first half of that year may show slower growth.

Outcome and committee action: committee members reported reaching agreement on the Insurance Department numbers for the conference report. The committee accepted an IPT baseline of $175 million for FY2025 and biennial figures of $165 million (FY2026) and $168 million (FY2027) as the working assumptions for the conference negotiations. Committee members acknowledged that raising the FY2025 IPT baseline increases surplus estimates and affects transfers to the rainy-day fund and other offsets.

Next steps: members agreed to hold detailed line-by-line decisions on the business tax growth rate and several budget line items until revenue chairs from each chamber (Ways and Means chairs) meet to try to find common ground. DRA and the Insurance Department were asked to supply further updated June receipts and related detail to the committee; members discussed the possibility of reconvening with more up-to-date June collections after the June 15 estimated-payment deadline.

Committee context: the meeting included extended discussion of how dedicated funds (for example, E911 fees) and fee-based revenues were being treated in the two chambers' proposals and how those treatments cascade through the budget. Members repeatedly noted that adopting an optimistic revenue baseline would make future mid-biennium corrections more difficult if collections fall short.

What the committee did not do: the conference committee did not adopt a final, comprehensive revenue baseline for the entire budget at this session and left multiple line-by-line items and the business tax growth-rate decision unresolved pending a meeting of the chamber Ways and Means chairs and further June data. The insurance-tax numbers were the clearest formal agreement reached at the session.

Ending note: committee members scheduled additional conference sessions for the next day and asked DRA and departmental staff to return with updated June receipts and clarifying schedules; Chairs from both chambers planned to coordinate before the committee reconvened.