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Lawmakers hear competing views on restricting long-term leases for school and municipal fixtures
Summary
HB1066 would tighten approval rules for long-term lease-purchases and bar use of escape-clause leases to finance items that become fixtures; supporters cite taxpayer protection, opponents warn energy‑performance projects would be hampered.
Representative Diane Power told the committee HB1066 seeks to curb misuse of multi-decade lease arrangements (with non-appropriation or "escape" clauses) that commit taxpayers to long-term financing for items that become fixtures once installed. Under the sponsor’s proposal, leases for equipment with non-appropriation clauses under $100,000 would remain subject to a simple-majority vote; larger or fixture-type leases would require public hearings and a higher approval threshold (three-fifths ballot vote), and the bill clarifies how RSA 33:7E and a proposed RSA 33:7F would apply.
Energy-industry testimony highlighted that tax-exempt lease-purchase agreements are commonly used to finance energy-performance contracts (EPCs) that replace boilers, upgrade HVAC and improve efficiency; bond finance is sometimes impractical. Timothy Dunovan, a project executive for an energy contractor, urged the committee to avoid measures that would impede EPCs and local capacity to pay for deferred maintenance. Supporters of HB1066 and some municipal speakers pointed to examples where lease structures costing more than bonds were used and argued that the bill would push larger capital projects to more transparent and often less costly bond financing.
Committee members questioned different financing trade-offs, noted state borrowing and contracting practices, and weighed safeguards for legitimate energy-performance projects versus protections against long-term taxpayer exposure to high-cost leases.
