Thursday, July 30, 2009

New Hampshire Loses $110 Million Court Case

The State of New Hampshire was dealt a blow when a judge presiding over a suit filed by a number of doctors, medical practices, clinics, and at least one hospital ruled the state had no right to take $110 million from a medical malpractice insurance fund in order to help balance the state budget.

Belknap County Superior Court Justice Kathleen McGuire said the state had no right to the funds because they belong to the Joint Underwriting Association.

The ruling leaves the state needing $65 million to balance last year’s books, and another $45 million for the current biennium.

It's no surprise the state will appeal the decision.

It's likely the governor will have to call a special session of the legislature to deal with the $110 million hole in the budget. I have no doubt they'll try to raise even more taxes because it's expedient rather than doing the prudent thing and cut a still bloated state budget by $110 million to eliminate that part of the deficit. (Yes it's bloated. They raised spending by over $1 billion, or 13 percent, at a time when we couldn't afford it. They claimed they made the necessary budget cuts, meaning that instead of increasing spending by 15% they only increased by 13%.)

The Legislature and the Governor have been on a spending spree over for over 2 years and are continuing it for another 2 years. Let's see if they'll do the right thing rather than the Left thing and cut the budget.

Tuesday, July 28, 2009

The First (Tax) Shot Across The Bow

We've been fortunate, my family and I, being able to weather the downturn in the economy without too much discomfort, for the most part. But it hasn't been easy.

Back in March every employee of the company I work for, from the CEO on down, took a 10% pay cut. We all saw that as being far better than being laid off. As things turned around a bit, our pay was restored. However we were all told that until further notice there would be no pay raises, again something that did not surprise us.

The small business my wife and I own (my wife is the CEO and I'm the handyman and IT guy) has felt the effects of the economic downturn, with business falling off about 40% from a year ago. Deb took on more hours to keep the payroll low and carefully managed what income was generated and what was spent to support the business. Even with the fall off in business we've been able to pay the bills and pay the loan we took to purchase the business. Then the legislature of the state of New Hampshire decided that in these tough times they needed to increase the state budget by over $1 billion, a 13% increase over the previous budget. The legislators and the governor claimed they had actually cut the budget, though I can't figure out how a $1 billion+ increase can in any way, shape, or form be described as a budget cut. To pay for such a generous budget increase the legislators and the governor decided it was quite alright to tax the bejeezus out of small businesses in the state to pay for all these “invisible” budget cuts, hitting over 45,000 small businesses in the pocket book at a time when many of them are struggling to survive. It certainly has hit us hard.

Starting on August 1st my wife stops taking a salary from the business. She had earlier cut her own pay to make sure we maintained a cushion to keep the business in the black. With the additional taxes imposed by our state she has had to cut her pay to zero. Without the cut we would be in trouble, unable to pay all the bills, the rent, franchise fees, payroll, loan payments, or any of the other dozens of expenses running a business entails.

If this is how the Democrat majority in the New Hampshire Legislature think they're helping us, then they are deluded. All they've managed to do is put the squeeze on the very businesses they're relying on to help turn the economy around. How stupid can they possibly be?

Wednesday, July 15, 2009

FairPoint Coming Under Closer Scrutiny

Is it the beginning of the end for FairPoint Communications in northern New England?

Vermont's Department of Public Service is asking for an investigation because FairPoint has been unable to correct problems with customer service and billing issues. The issue is not unique to Vermont as New Hampshire and Maine have also suffered ongoing problems with the beleaguered telecommunications company.

Over the objections of consumer advocacy groups and numerous residents in Maine, New Hampshire, and Vermont, FairPoint Communications bought the wireline assets of Verizon in northern New England. Many, including yours truly, were against the sale because it was a matter of a small rural telephone company with a spotty track record taking on the assets (and problems) of a much larger competitor and paying far too much money for them.

Since the changeover from Verizon's to Fairpoint's system at the beginning of this year, the number of complaints has skyrocketed and the slow bleeding off of wireline customers has turned into a hemorrhage, with many customers dumping their FairPoint landlines in favor of cell phones or VoIP digital phone service from their local cable companies.

FairPoint has tried to answer their critics with campaign ads, while adding an executive position created to solve the ongoing problems with customer service.

That's all well and good, but TV ads and the addition of yet another vice president in and of themselves do not solve the problems. If FairPoint doesn't get its act together it can count on at least one state – Vermont – to invalidate its license to conduct business there, meaning they would no longer be allowed to provide telephone service within Vermont.

This is no surprise.