The N.H. House has passed a bill that would require the state to reinstate a portion of its contribution to retirement costs for teachers, firefighters and police officers.

Democratic-sponsored House Bill 1417 would pay 7.5 percent of the costs incurred by municipalities, school districts and — by extension — local taxpayers to fund the N.H. Retirement System costs for these three categories of employees.

A total of 25 Republicans, none of them from the Monadnock Region, broke ranks with their party Thursday to support the measure, which was approved 186-159 and now goes to the N.H. Senate.

Rep. Michael O’Brien, D-Nashua, told lawmakers the measure is called the “Property Tax Relief Act of 2022” because it would reduce the percentage of retirement costs property taxpayers must cover as part of municipal budgets.

In 1977, the N.H. Retirement System paid 35 percent of retirement costs for police, firefighters and teachers. Over the years, the state contribution was reduced to zero, while retirement costs have continued to increase.

“Now where did that contribution go?” he asked. “It didn’t vaporize. You know what you did? You rolled it right back to each municipality and political subdivision in this state. In a way, you created a tax that is paid by each municipality.”

Rep. Peter Leishman, D-Peterborough, also rose in support of the bill, saying the state can afford its cost, which is estimated at $27.79 million in fiscal year 2024 and $28.47 million the following year.

“Yesterday, state revenues exceeded the plan by $230 million and the Rainy Day Fund presently has $257 million,” he said.

Rep. Ken Weyler, R-Kingston, said the state stopped contributing to retirement costs because of the unpredictability of those expenses. He also said HB 1417 amounts to a “false promise.”

“The $28 million in the bill wouldn’t go very far among 1.3 million,” he said, referencing New Hampshire’s population. “That makes it about $20 per person.”

 

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