Nanny rates

On Wednesday, the House defeated a bill to re-allow a variation of so-called “payday loans” — short-term, high-interest loans — that lawmakers banned in 2009. The vote on Senate Bill 160 was narrow at 186-179, and the issue generated passion and contrasting views on the role of government.

“What have we come to? We were elected to get government off our backs and no more nanny states. I’m really disturbed,” said Rep. Steve Vaillancourt (R-Manchester).

“This will make loan sharking an acceptable business,” said Rep. Donna Schlachman (D-Exeter). “It’s state-regulated usury.”

Stuck in the middle

A Senate committee has voted to kill a House measure that would withdraw New Hampshire from the Regional Greenhouse Gas Initiative. Sen. Jeb Bradely (R-Wolfeboro) is trying to keep RGGI alive, but make it a whole lot different.

“There are people who want to keep the program exactly as is, and there are people who want to repeal outright. We’ve got a long way to go with this,” Sen. Jeb Bradley (R-Wolfeboro) told the Concord Monitor about the amendment to House Bill 519 he plans to introduce on the Senate floor next Wednesday.

The article says his plan would lower the cap for the price of carbon from $9 per ton to $1 per ton (it’s currently $1.86). It would also turn that money back over to utilities, rather than use it to fund a state-administered grant program for renewable and efficient energy projects.

Power pleas

The House voted 261-104 to pass its version of Senate Bill 148, which would return any federal grant money for health care reform and force the state Attorney General to join the multi-state lawsuit against the law. The debate on the House floor was pointed and sharp.

“We don’t want to do anything, anything that will allow this federal law to plant its poisonous seeds in our state,” said Rep. Andrew Manuse (R-Derry).

“I urge you to read article 37 (of the state Constitution), use your common sense, deny this lust for power and defeat this amendment,” said Rep. Gary Richardson (D-Hopkinton).

Accounting jujitsu

Sen. Lou D’Allesandro (D-Manchester) was puzzled by a Senate Finance Committee amendment to House Bill 635. It would cut the Department of Corrections budget by $10.5 million by sending 600 prisoners from the state prison in Concord to an as-yet unknown location run by private companies.

“I really didn’t see any materials that indicated we could save $10.5 million. I didn’t know where they were going, how they were going to get there, what the costs would be,” said D’Allesandro, who was the only Finance Committee member to vote against the bill.

On Wednesday, the full Senate did not take up the amendment and the bill was returned to the Finance Committee.

This Daily Briefing was written by Michael McCord.

With the deadline to “Crossover Day” on March 31 fast approaching, both the House and Senate are in session this week to finish work on their remaining bills.

The two main budget bills are the top remaining bills in the House. The Senate will clear its docket of more than 49 bills and amendments. The Senate will be in session Wednesday and the House is scheduled for two days, Wednesday and Thursday.

Education Funding Amendment

“Responsibility” is the key difference between the House and Senate versions of a constitutional amendment related to education funding.

An amended Senate proposal, sponsored by Sen. Nancy Stiles (R-Hampton) reads, “the general court shall have the authority, responsibility, and discretion to define reasonable standards for elementary and secondary public education, to establish reasonable standards of accountability therefor, and to mitigate local disparities in educational opportunity and fiscal capacity.” {emphasis added}

The word “responsibility” is absent from the House version of basically the same measure. This causes some to be concerned that merely “allowing” for targeted state aid, as the House version does, won’t get the job done. Gov. John Lynch is among those who wants to see the Legislature’s responsibility for education funding made explicit.

The Senate votes this week on their version of the measure, CACR 14 (the amended version can be read here). The House passed theirs, CACR 12, sponsored by Rep. David Hess (R-Hooksett), March 16.

Payday Loans

Is there a market a for high-interest installment loans? Some senators think so, and don’t believe the Legislature should get in its way.

The Senate votes this week on a measure to revive two types of high-interest, installment loans, including the so-called “payday loans” that lawmakers either banned or modified in 2008.

Sponsored by Sen. Sharon Carson (R-Londonderry), Senate Bill 160 passed the full Senate by a narrow 13-11 on March 16 and was given a second approval by the Senate Finance Committee.

Voter ID

A move to require photo identification from all voters is also making its second trip to a full Senate vote this week.

Republican supporters say the measure will prevent voter fraud, while opponents say it attacks a problem that doesn’t exist and discourages voting. The bill is sponsored by Sen. Sharon Carson (R-Londonderry).

Senate Bill 129 is sponsored by Sen. Sharon Carson (R-Londonderry). It passed the full Senate by an 18-6 vote on March 16 and was given an ‘ought to pass’ recommendation by the Finance committee in a 4-3 vote.

>> Full session of the New Hampshire Senate, the State House, Wednesday March 30, 10 a.m.

This Daily Dispatch was written by Michael McCord, with contributions from Hilary Niles.

In this installment, we look at five bills that are part of the so-called Regular Calendar for the House this week — meaning they are subject to floor debate and roll call votes where every lawmaker’s vote is recorded. These are measures we’ve covered this session, encompassing issues including medical marijuana, abortion, the Financial Resources Mortgage scandal, and taxes.

To help you follow along, the committee names are linked to previous Front Door Politics dispatches on these bills.

Medical Marijuana

Health, Human Services and Elderly Affairs

In November, we noted that Rep. Evalyn Merrick (D- Lancaster) was submitting another medical marijuana legalization bill after Gov. John Lynch vetoed a similar effort last year. This time around, House Bill 442 passed the committee with a strong, bipartisan 14-3 vote recommending it pass the full House.

A Second FRM Study Committee

Commerce and Consumer Affairs

House Bill 178, a Republican-led effort to establish a second committee to study the recently exposed Ponzi scheme at Financial Resources Mortgage, received a positive recommendation from its committee.

The FRM Commission established by Democratic leadership last year filed a report in December. The supporters of HB 178 believe a follow-up committee could incorporate all the various reports on the scandal — including a report due out by the end of the month from the N.H. Bureau of Securities Regulation — to provide a comprehensive resource for the House in case of further legislative action.

Parental Notification

Judiciary

By a 12-4 vote, this committee gave House Bill 329 an Ought to Pass recommendation. The bill would reestablish a state parental notification requirement before “unemancipated children” can have an abortion. Exceptions would be medical emergencies or cases in which the minor is granted a waiver from notification requirements through confidential court proceedings.

The majority report says the bill should be supported because:

• It has “the fairest and most accessible judicial by-pass system that has ever been proposed in New Hampshire or any other state”
• “It will not negatively affect the health or safety of any female children in New Hampshire”
• “It reinforces the legislature’s belief that parents are the most important part of a child’s life and are necessary to protect the children from their own immaturity”
• “It fosters the family structure and preserves it as a viable social unit”
• “It brings New Hampshire in line with 43 other states that have passed such laws to protect their children.”

The minority report opposing the bill says that 75 percent of young women do get support and parental guidance. But for “those who are unable to do so have heartbreaking reasons: there is physical or sexual abuse in the home; the parent is unable, through physical or mental illness or addiction, to offer support; the young woman fears being thrown out of the home. Currently, these most vulnerable young women have the safety net of safe, legal health care provided by experienced licensed medical professionals and counselors.  For these young women who lack parental support, passage of this bill poses very real risks to their health.” The minority report also questions whether the courts, especially in small towns, can really ensure confidentiality in judicial bypass proceedings, and whether the judicial system has the funding to cover their costs.

Tax Cuts

Ways and Means

We think it’s a safe bet that the House will approve two tax cut proposals for the tobacco tax (House Bill 156) and the business profits tax (House Bill 213). If passed into law, the combined drop in 2012 revenues to the state would be an estimated $25 million. It’s also likely that, when passed, both bills will be set aside (“laid on the table”) as was the fate of the three previous tax cutting measures (see previous dispatch here.)

This Daily Dispatch was written by Michael McCord.

Sponsored by Rep. Beatriz Pastor (D-Lyme), PACE became law last year, but hasn’t yet been used. A move to repeal it will be considered in an executive session in the House Municipal and County Government Committee today. But Pastor tells Front Door Politics that Republican committee leaders gave her a chance to change PACE in order to save it.

This rooftop solar electric system is at work on a rooftop in Durham, NH. (photo courtesy Revision Energy)

The PACE program allows cities and towns to finance residential and commercial energy efficiency and clean energy projects through municipal loans of up to $35,000. Each loan is to be paid back by the property owner who receives it, through increased tax payments for up to 20 years.

PACE supporters say the program meets a financing need banks and other forms of financing have yet to fill – and would help local taxpayers save significant amounts of money on their energy use.  (See an earlier Daily Dispatch here for more explanation about the debate over PACE.)

Rep. Carol McGuire (R-Epsom) disagrees. She opposed the original PACE legislation, and told Front Door Politics in January that it was “not good public policy,” presented too much risk for local taxpayers, and “would benefit the few at the expense of everybody else.” McGuire sponsored this year’s PACE repeal bill, House Bill 144, which goes to executive session today.

The repeal bill was originally scheduled for a committee vote on Jan. 27, but Pastor says committee chair Rep. Beverly Ferrante (R-Derry) and vice-chair Rep. Franklin Sterling (R-Jaffrey) gave her time to address “the concerns the committee” had about the original legislation. Those concerns included

• the type of bonds that municipalities could use to set up the revolving loan funds to finance energy improvements
• how to establish a municipal “loss loan” program to protect municipalities against possible default by property owners who get the loans, and
• clarifying whose repayment would be prioritized (the municipality or a mortgage holder) in case of default

“We have proposed amendments to answer those concerns,” Pastor says. In particular, she says the issue of repayment precedence — which has been complicated by federal mortgage regulations — has been solved by only allowing residential applicants who no longer have mortgages to use the program (commercial property applicants fall under different guidelines).

“For communities who choose to go down this road, we have made it strong enough to get it started and to work in a narrow framework,” Pastor says. She adds that the process “has been truly bipartisan.”

That acknowledgement is brought into relief by an even bigger energy debate falling mainly along party lines. The House voted 246 to 104 Wednesday to repeal the Regional Greenhouse Gas Initiative (RGGI). House Bill 519 now goes to the House Finance Committee before crossing over to the Senate.

>> Thursday, Feb. 24, Municipal and County Government Committee, executive session on HB 144, Legislative Office Building, Room 301, 1 p.m.

This Daily Dispatch was written by Michael McCord, with contributions from Hilary Niles.

Banking Commissioner Peter Hildreth has resigned before likely being fired from his job. (photo courtesy N.H. Banking Commission)

At times, you need a score card to keep of the various legislative and regulatory investigations into the state’s greatest Ponzi scheme. But we might be nearing the end of the trail. As far as we know, the Secretary of State’s office is last state agency conducting its own investigation. Hildreth’s resignation (effective Jan. 1) ended four days of Executive Council hearings. And those hearings coincided with the release of the report by a joint House and Senate legislative study committee looking into the FRM affair that found plenty of fault to go around—to the banking department, securities department and attorney general’s office. To paraphrase the line in the classic movie “Cool Hand Luke,” what the state had was a clear failure to communicate on a number of levels.

As we noted last week, the legislative report includes recommendations to change the state’s consumer protection laws, clarify jurisdiction for the state’s banking and securities regulators, and improve inter-agency communication to protect investors, lenders and consumers. It also recommends that private citizens be provided with more options to resolve complaints when they believe that regulators have failed to act promptly or appropriately. What is less clear is what the new legislature is going to do about all of this.

Gov. John Lynch, who had called for Hildreth’s resignation in June (when the state Attorney General’s FRM report was released), was equally insistent last week that Hildreth’s exit off the public stage wasn’t part of a settlement—even though, according to the Associated Press, he won’t need to go into work for the rest of the month. Hildreth, who was appointed in 2001 and reappointed by Lynch to serve until 2013, can begin planning on collecting state retirement benefits (including health care) next year when he turns 60. For his part, Lynch can now move to fill the post of commissioner, which has been vacant since Hildreth was put on a paid leave months ago.

One of the investors who lost money was less than impressed with the result. Al McIlvene of Kittery Point, Maine, who with his wife lost about $800,000 through FRM, believes Hidlreth should have been fired. McIlvene told the Associated Press he was rankled when Hildreth testified that it was a “sad thing” that the scheme’s victims were “expecting a certain lifestyle” that they lost in the scandal.

“The human tragedy that has gone on here is more than just an impact to a lifestyle,” McIlvene said. “We’re talking about people who are losing their homes, declaring bankruptcy, getting divorced, we’ve had two suicides. This has had dramatic impact on hundreds of people and for him to say it’s a lifestyle change is clearly understating the problem.”

We’ll leave the final word for today with an editorial in the Keene Sentinel. In a sobering and sometimes scathing take about the FRM investigations and its aftermath, the Sentinel editorial observed, “Given the inconclusive but sweeping nature of the FRM regulatory failure, it’s unlikely a more fitting solution could have been found.”

This Daily Dispatch was written by Michael McCord.

Hearings begin Monday on whether or not Banking Commissioner Peter Hildreth keeps his job. (photo courtesy N.H. Banking Commission)

Hildreth is accused of failing to act against Financial Resources Mortgage of Meredith. According to federal and state investigators, FRM ran an $80 million Ponzi scheme for almost a decade before the company collapsed in November 2009. As many as 150 investors and private lenders were defrauded out of more than $30 million. On Oct. 6, Gov. John Lynch and the five-member Executive Council approved a petition of removal against Hildreth.

The hearings are set to begin at 8 a.m. Monday in Room 306 of the Legislative Office Building. It’s uncertain how long they could last, especially given that Hildreth’s lawyer has an extensive witness list. A Lynch spokesman said Tuesday that “additional hearings will be scheduled throughout the week as needed.” In other words, don’t expect a quick process.

FRM Committee Completes Work

Speaking of FRM, the joint House and Senate legislative committee investigating the scandal and the state’s regulatory structure for securities and investments has had its final meeting and issued its final 100-page report of findings and recommendations for future legislative action.

“This provides a roadmap with policy options for the next legislature to consider to better protect lenders and investors going forward,” said Sen. Maggie Hassan (D-Exeter), who served as co-chair of the committee with Rep. Ed Butler (D-Hart’s Location).

The draft report recommends changes to the state’s consumer protection laws, clearer jurisdiction for the state’s banking and securities regulators and better inter-agency communication to protect investors, lenders and consumers. It also recommends that private citizens be provided with more options to resolve complaints when they believe that regulators have failed to act promptly or appropriately.

“The challenge for the Legislature will be to enact reforms to ensure that regulators will detect fraudulent business conduct quickly and will have the authority, the tools, the mandate and the resources to limit exposure of the public to such behavior,” the report reads.

“This is one piece of a very large puzzle and we understand that the next Legislature will look not only at this report but at any new information that comes forward,” Butler said.

But, as Front Door Politics suggested earlier this week, taking the recommended actions may prove easier said than done. Committee member and incoming Senate President Peter Bragdon (R-Milford) said “some of these recommendations can be easily addressed, but others are more philosophical and will take longer.”

The 25-member joint committee, made up of the House and Senate Commerce committees, was created in the spring following requests by those defrauded by FRM. The legislative investigation was also sought by lawmakers such as Rep. Jim Splaine (D-Portsmouth) who were skeptical that executive branch investigations into the scandal would be thorough and complete. Since May, the committee took testimony from many state agencies such as banking securities and the attorney general’s office, as well as members of the public who ere defrauded.

You can hear an audio transcript of the committee’s final meeting on Nov. 23 here.

Come Back Monday

The State House is closed today for the Thanksgiving holiday weekend.

This Daily Update was written by Michael McCord.

Outgoing Sen. Maggie Hassan (D-Exeter) chairs the joint legislative committee investigating the FRM scandal. (photo courtesy NH General Court)

The joint legislative oversight committee investigation into the FRM scandal—the same one threatening the future of Banking Commissioner Peter Hildreth and that has spawned numerous state and federal investigations—will issue its final report Dec. 1. The committee, which has held meetings since May, issued an 84-page interim report on Aug. 31 outlining a series of regulatory loopholes and possible legislative actions to close those loopholes. It holds its final regular meeting today in Concord.

While the draft report cites numerous “organizational failures” that allowed FRM to escape oversight, figuring out who did or didn’t do what and crafting new laws for the coming legislative session will likely be easier said than done. For one thing, the four Democratic senators on the committee—including co-chairs Sen. Maggie Hassan and Democratic Rep. Ed Butler—were defeated in the Nov. 2 election and won’t be around to push for any legislative proposals in the next session.

FRM was a Meredith-based commercial mortgage broker and lender that went under in November 2009. According to federal civil and criminal complaints, FRM allegedly defrauded scores of lenders and borrowers for amounts ranging from $20 million to $80 million. For some very interesting reading, take a look at the 71 pages of written comments from people with a stake in the outcome—including defrauded investors. The comments range from technical to highly personal and they show the complexity and tragedy of this regulatory disaster.

This Daily Dispatch was written by Michael McCord.

>> The Joint Legislative Committee to Review the State’s Regulatory Oversight of Financial Resources Mortgage will meet in Concord at the Legislative Office Building, Rooms 306-308, Tuesday, Nov. 23, at 2 p.m.

An advisory council tries to get New Hampshire education into gear to support Granite State manufacturing.

Minding the Manufacturing Gap

Responding to a gap between what’s taught in school and the knowledge needed by certain sectors of the workforce, an advisory council was created in 2008 to help build some bridges, so to speak.

The Advanced Manufacturing Education Advisory Council—a group of educators, manufacturing representatives and only two lawmakers—released a brochure in early October with suggestions for the Department of Education. Among them:

1. Strategize how the advanced manufacturing sector can educate parents, teachers and students about career opportunities
2. Increase communication between manufacturing and education to make sure that what’s taught lines up with the current realities of the industry
3. Strengthen math education
4. Make advanced pre-engineering and manufacturing education more accessible to all students.

>>The Advanced Manufacturing Education Advisory Council will meet in Room 103 of the State House today (Thursday) at 3 p.m.

Showdown

At the Local Government Center’s annual conference in Manchester on Wednesday, Kathy McCormack of the Associated Press covered the public meeting between David Lang of the Professional Firefighters of New Hampshire and Maura Carroll, the LGC’s interim director.

Lang, a former LGC board member, doesn’t think the nonprofit is using taxpayer money wisely. He’s gone to court to get the LGC to open up its books. Carroll says the LGC is doing its job (see Tuesday’s post for more background).

Not surprisingly, McCormack reported, Lang and Carroll agreed to disagree.

Banking Commissioner Peter Hildreth wants to keep Gov. Lynch out of the hearings as Hildreth fights for his job. (photo courtesy N.H. Banking Commission)

Keeping Lynch Out

A Merrimack County Superior court judge heard arguments Wednesday over whether or not Gov. John Lynch should take part in the Executive Council hearings beginning Nov. 29 to determine the fate of Banking Commissioner Peter Hildreth, the Concord Monitor reported. Hildreth’s lawyer claimed Lynch has prejudged the case, while Lynch’s lawyer disputes the charge.

One thing is clear: Lynch has publicly wanted Hildreth to resign for months for what Lynch called a “failure of management” in the Financial Resources Mortgage scandal. Hildreth did not offer his resignation and has been on paid leave since May.

>> The greater separation-of-powers question is this: Will a court step in and referee an executive branch proceeding?

If Lynch has already made up his mind about Hildreth, should that keep him out of the hearings on Hildreth’s job? Say your mind using the comment form or social media links below.

Housekeeping for a new session: The NH Senate chamber looks bare without desks, which were out for repair this fall

Plus: How steep is the legislative learning curve? More than 150 newly elected lawmakers are finding out today as they begin their two-day orientation session at the State House to learn the basics of being a legislator. You can see our earlier post about the orientation process here.

Executive Decisions

Gov. John Lynch and the lame-duck Executive Council will hold a public meeting tomorrow to consider a 213-point agenda that includes accepting $41 million of federal stimulus money for education. On Monday, the joint legislative fiscal committee voted to send half the money to schools and the other half to the state’s General Fund.

The current 3-2 Democratic majority on the Executive Council evaporated on election night and in January, Lynch will begin to work with an all-Republican council.

Among the many issues and appointments to come include the fate of state Banking Commissioner Peter Hildreth. Hearings begin Nov. 29 on whether to fire him for his role in the Financial Resource Mortgage scandal (see our earlier post for more background). The Executive Council will also take up the job of replacing retiring Supreme Court Justice John Broderick.

>> The Executive Council will meet at the State House on Nov. 17 at 10 a.m.

Outgoing Sen. Jacalyn Cilley (D-Barrington) has a message for the Local Government Center.

Parting Shot

Outgoing Democratic Sen. Jacalyn Cilley of Barrington isn’t leaving town quietly. Yesterday, she released a statement taking aim at the Local Government Center (LGC) after a recent interim report by the Secretary of State. Cilley called on the LGC to end “its arrogance, subversive tactics and deceptive behavior regarding the operation of its Health Trust, tell cities and towns the truth about the money it spends and obey the law by returning surplus monies to the taxpayers.”

The Local Government Center, which provides programs and support for the more than 200 cities and towns in the state, has come under fire and investigation for how it is organized as a non-profit, how it spends money and how it returns surpluses to its clients.

The city of Portsmouth has asked for a refund of more than $280,000 from money paid into a pooled health insurance plan — and yesterday, the Portsmouth Herald reported, town employees in North Hampton protested against the LGC.

A major investor protection law passed earlier this year (House Bill 1393) allowed the Bureau of Securities Regulation to investigate the LGC, which said it is reviewing the interim report and that it has already begun to implement reforms that address many of the issues brought up in the report.

These men didn't waste any time getting engaged after the NH Legislature legalized same-sex marriage.

Three and Counting

Three new bills to repeal the state’s equal marriage law are pending for next year. The law was passed in 2009 and went into effect Jan. 1, 2010. The three challenges to it will come from Republican House members Mike Kappler of Raymond, David Bates of Windham and Leo Pepino of Manchester. Yesterday (Nov. 15) was the first day for lawmakers to file complete information for their LSRs. The deadline is Dec. 3.

This Daily Update was written by Michael McCord.

>> Front Door Politics wants to hear from our readers what we should be talking about when it comes to policy—and a little politics—at the State House. What’s on your mind?

Sen. Amanda Merrill (D-Durham), who is currently vice-chair of the Senate Energy, Environment & Economic Development Committee, says there has been good bipartisan work done to date on energy policy with colleagues such as Sen. Jeb Bradley (R-Wolfeboro). They have both just been re-elected to another two-year term.

Merrill says she is “hopeful” state energy policy will be at least one area that lawmakers of both parties can find common ground because so much progress has been made. She points to the 2007 Renewable Energy Act, which established a renewable energy portfolio for the state and mandated that 25 percent of the state’s electricity come from renewable sources by 2025.

More recently, three renewable energy bills drew a lot of attention—and achieved varying degrees of success—during the 2010 legislative session.

Companies Competing for Renewable Energy Funds

Workers install a rooftop solar energy system in Manchester. (courtesy PSNH)

As reported in Front Door Politics earlier this year, the most controversial would have allowed electric companies to keep up to 25 percent of payments they otherwise would pay into the state Renewable Energy Fund. The money saved would have to have been invested in sustainable energy projects that would immediately create jobs, according to Senate Bill 334.

While this had strong support in the Senate, it was overwhelmingly rejected in the House by a vote of 300-46, in part because it would change an already established competitive grant program that individuals, businesses and, to a lesser extent, municipalities can access.

Creative Loans for Small-Scale Renewable Energy Projects

House Bill 1377, which allows utilities to establish a loan fund for renewable energy projects for residential and commercial customers, was signed into law in June. As an example of how the program might evolve, the New Hampshire Electric Co-Op has established a “SmartSTART” initiative. It’s a no-money-down option to have energy efficient products installed in a home or business, with the cost of the improvements repaid over time in monthly bills.

For instance, if a customer installs energy efficient products worth $500 and those products save the customer $50 per month, the customer will pay for the product in monthly payments on their electric bill equal to three-fourths of the savings, or $37.50 per month.

Studying State Energy Policies

Merrill co-sponsored Senate Bill 323, which is a $300,000 project to study, basically, all of the state’s energy policies. An independent contractor will conduct the study and the Public Utilities Commission will oversee it.

Specifically, the study will be a “comprehensive review and analysis of energy efficiency, conservation, demand response, and sustainable energy programs and incentives in the state, and recommendations for possible improvements to maximize their effectiveness and increase coordination of those programs and incentives.”

Among the agenda items for its regular monthly meeting tomorrow, the state Energy Efficiency and Sustainable Energy Board will get an update report on SB 323 and the bidding process for a vendor to do the energy policy review. That final report is due Nov. 1, 2011.

>> Monthly meeting of the Energy Efficiency and Sustainable Energy Board will be held at the Public Utilities Commission offices, 21 South Fruit St. in Concord, on Friday, Nov. 12 at 9 a.m.

This Daily Update was written by Michael McCord.