Borrowing costs

Governor says state should limit borrowing costs

June 21 – CONCORD – Faced with rising interest rates and a potential recession, Governor Chris Sununu said the state should spend some of its excess cash to pay for construction projects over the next two years.

Sununu said if re-elected, he would likely recommend spending about $125 million on projects in the next two-year capital budget, which he will present to the Legislative Assembly next February.

“With this $125 million, should all of this be bonded? I don’t think so,” Sununu said during the first of two days of public hearings on state agencies’ capital budget requests.

“We will have excess funds to use cash to minimize the money we typically used to borrow.”

Currently, the state has a revenue surplus of $400 million over forecast, and experts estimate it could reach $450 million by July 1, 2023.

Government borrowing costs, which would be passed on to taxpayers, could be “astronomical if we are not careful”, Sununu said.

The big construction item that won’t be in the next state budget is a new men’s prison to replace the main prison in Concord built in 1878.

The governor said he supports setting aside money in this plan to do a feasibility study on the right size and design of a new facility.

“We will probably need this new prison within the next five years,” Sununu said.

“There could be a cooling in the markets over the next two years, which would make it more affordable.”

Declining prison population

Corrections Commissioner Helen Hanks said the prison population has fallen by 28% over the past 15 years.

Currently, 1,884 inmates are in Concord’s men’s and women’s prisons and a minimum-security men’s prison in Berlin.

Concord Men’s Jail has 1,380 inmates and part of the facility is overcapacity, Hanks said.

“We’re actually in a good position at this point,” Hanks said.

The cost estimate for building a new prison is around $350 million, she said.

The study will examine whether, in addition to replacing Concord Prison, the state should expand Berlin, which has space on the property, Hanks said.

Hanks said the state should prepare to take that step before prisoner advocacy groups sue for a new prison.

“We would always be better off doing it ourselves than having an interest group go to court and ordering us to do it,” Hanks said.

Here are some other requests that agency heads are asking Sununu to include in its proposed capital budget:

— Cannon Mountain Streetcar: The Department of Natural and Cultural Resources notes that the streetcar is over 40 years old and needs to be replaced. It would cost $15.7 million. The agency collects $1.8 million a year in tickets and other revenue from those who climb to the top of the mountain.

—Hampton liquor stores: The State Liquor Commission wants to replace the two factory outlets on either side of Interstate 95. Due to inflation and the cost of materials, the price of this project has risen from 14 million in 2018 to $22.5 million.

—Community colleges: A top system priority is $5.5 million to upgrade Little Hall at New Hampshire Technical Institute and $2.5 million to renovate the Turner Building on the Laconia campus.

—Department of Safety: The agency wants to make $1.5 million in upgrades to its Bell 407 helicopter which is used for a variety of services ranging from aerial rescues to highway speed enforcement.

—Information Technology: Commissioner Denis Goulet said the agency’s top priority is $2.6 million to make system improvements to guard against cyberattacks.

—Department of Energy: Commissioner Jared Chicoine said the state needs to replace software that supports grants under the federal Low-Income Home Heating Assistance and Energy Assistance programs. weatherization. The state’s five anti-poverty or community action programs distribute these grants to eligible families.

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