November 1, Membership. Representative Jeffrey Goley, Chair Senator Sharon Carson
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2 Report of the Commission to Study Opportunities and Options to Improve the Sustainability of the Fish and Game Department (RSA 206:1-c, HB 256, Ch. 230:3, Laws of 2014) November 1, 2014 Membership Representative Jeffrey Goley, Chair Senator Sharon Carson Representative David Kidder Senator Lou D Allesandro Glenn Normandeau, Director, F&G Dept. Theodore Tichy, Chair, F&G Commission William Crangle Richard Moquin, Esq. Daniel Wolf Background This Study Commission was established during the 2014 Legislative Session to continue the work of the commission of the same name established the prior session (RSA 206:1-a, HB 588, Ch. 241:7, Laws of 2013). The duties were not changed, nor were the specifications for the membership makeup, though four of the positions on this Commission are filled by different individuals. The report of last year s commission recommended a continuation of their study due to time constraints and the complexity of the Fish and Game Department s financial situation. The formal charge given to the Commission is to study options and opportunities for ensuring the financial stability and sustainability of the Fish and Game Department. In fulfilling this charge, the Commission has drawn upon the good work of the prior commission in describing the financial problems confronting the Department and outlining some of the possible remedies that could be enacted. Since that information is contained in the final report of that commission, it has been attached to this report and is relied on to provide some of the background information for this report. Current Financial Situation The Fish and Game Department did provide the Commission with updated financial information that shows the Department running a significant annual deficit that appears to only be getting worse. The Department estimates that the balance of the undesignated surplus in the Fish and Game Fund will have fallen from about $2.19 million at the beginning of the current fiscal year (started on
3 July 1) to about $860,000 by the end of the fiscal year (June 30, 2015). This is even after being infused with $893,000 from the General Fund during the fiscal year. Going forward, the Department projects a negative balance of about $2.8 million at the end of the following fiscal year and $6.8 million the year after that. This constitutes an annual $3-4 million hole in the Department s annual operating budget out of an overall projected $15-16 million annual budget appropriation of unrestricted Fish and Game funds. Obviously, this is a very large problem that needs to be remedied. In the last few years revenues from license fees and other sources have been stagnant, whereas departmental costs have risen significantly, largely from normal increases to existing employee salaries and benefit premiums which are beyond the Department s control. Authorized full-time staff have already been reduced from 194 in 2009 to 181 in 2014 in an effort to manage personnel costs, with previous reductions occurring in prior years. The Executive Director believes that cutting staff any further will seriously degrade the Department s ability to fulfill its statutory obligation to protect the wildlife resources of the state and the people who enjoy them, plus the various other duties it has been assigned. To help address this situation, the Commission makes the following recommendations. Recommendations 1. Debt service payments made by General Fund The Department currently has to pay from the unrestricted Fish and Game Fund about $450,000 per year in debt service to the State Treasurer for state bonding that occurred over the past years to repair and modernize its fish hatcheries ($4.4 million), reconstruct three of its dams ($1.4 million), and make improvements at its office facilities ($490,000). Some of these projects not only benefited hunters and, in particular with these projects, fishermen, but also the general public in terms of cleaner waters and healthier fish (pollution control at hatcheries), recreation and safety (reconstructed dams), and the variety of nongame species that live within or make use of aquatic/wetland environments (reconstructed dams again). The Commission believes that since many of the benefits of these capital projects accrued to the general public, it is only fair that at least part of the debt service associated with these projects be paid by the General Fund or some other non-agency source of funding. 2
4 2. Fees set by Executive Director and F&G Commission rather than by statute In general, the license fees to hunt, fish, and trap were last increased by the Legislature in Those increases were critical in making the Department financially solvent at that time and for the next several years. Of course, fees set in statute are fixed until changed by the Legislature. This can have advantages or disadvantages based on your point of view. On a factual basis, the annual revenue stream brought in by the fixed license fees has been flat because the number of licenses sold has remained fairly steady. However, the buying power of that revenue stream has decreased over time due to inflation to the extent that, in broad terms, one needs $134 today to buy what cost only $100 in Inflationary pressures have caused the overall operational costs of the Department to go up to a similar degree without a parallel increase in revenue from license fees. At a Fish and Game Department public hearing last year, the question was posed to the 100 or so attendees as to whether they would support a raise in license fees. The support was practically unanimous. Though not a formal survey, the Department feels that there is an untapped support among license holders for a modest fee increase. This Commission recognizes that many legislators are very hesitant to raise fees, even at times when a given constituency may agree to it. Rather than argue the merits of that position, the Commission would like to move in a different direction and recommend that the Legislature authorize the Executive Director, with the approval of the Fish and Game Commission, to establish the license fees. This would be similar to the way in which another primarily self-funded agency, the Parks and Recreation Division which is within the Department of Resources and Economic Development (DRED), is presently responsible for establishing the fees for use of the state park system. Though the fees are set by the Commissioner of DRED, they must be approved by the Fiscal Committee of the General Court. All resulting revenues are deposited in the State Park Fund and used to pay for operating the state park system. If this proposal were implemented, the Commission believes that two factors will restrain the Executive Director from raising license fees beyond what is reasonable and prudent. One is that raising fees beyond a certain point is counterproductive since enough people will decide not to buy hunting and fishing licenses, or at least fewer of them, that revenues will actually diminish. The other is that all license fees will have to be approved by the Fish and Game Commission, which will undoubtedly prevent the fees from going to high. For added protection and to continue the involvement of the Legislature in the process, it could be required that the fees are also approved by the Fiscal Committee, as is done with state park system fees, or adopted by rule under RSA 541-A and 3
5 therefore subject to review by the Joint Legislative Committee on Administrative Rules. 3. Consider financial support from canoeists and kayakers Those who enjoy New Hampshire s lakes and rivers aboard a kayak or canoe benefit from a few departmental services that they do not monetarily support as a group. One is the boat access sites on public waters that the Department develops which are widely used by the canoe and kayak community. Another is the protection and management of all wildlife for future generations. Lastly is the emergency help provided by the Department s Law Enforcement division to any kayaker or canoeist who finds his or herself in a life threatening situation. The Commission believes that the owners of kayaks and canoes, among other outdoor recreation enthusiasts, should begin to contribute to such services. The Commission recommends that the Department work with the paddling community to move towards a consensus as to how such a program would be implemented. Issues to be addressed include: the fee amount or amounts, the impact on tourists, rental companies, camps, and retail stores, and how to accommodate individuals and organizations with numerous boats. 4. Institute reduced license fees for those 68 years of age and older In 1971 the Legislature lowered the age at which a person can receive a complimentary freshwater fishing, hunting or trapping license from 70 to 68 years. However, people are living longer now and therefore have a greater opportunity in their advanced years to hunt, fish or trap. It seems reasonable and fair for the Department to collect at least some license fee revenues from those who are able to utilize the state s wildlife resources later into life. The Commission therefore recommends that those 68 years of age and older be charged a license fee of $10 per year for a hunting or fishing license and $20 per year for a combo license. The Department estimates that this will provide $61,250 in additional revenue per year. 5. Educate the public on Department s larger mission The Department is commonly looked upon as an agency that just regulates hunting and fishing in the state and therefore is of little interest to those who do not engage in such activities. That view may have been correct in the early years of the Department, but not anymore. The Department is responsible for all of the wildlife in the state, including nongame species and those that are endangered or threatened. In fact, a considerable portion of its budget is dedicated to non-game management. The numerous dams that it owns not only create lakes and ponds for game fish, but also for all kinds of other species that thrive within aquatic and wetland ecosystems. These lakes and ponds are also enjoyed by recreational 4
6 boaters. In addition, the Department is responsible for a few programs unrelated to wildlife, such as the registration and regulation of OHRVs and performing Search and Rescue within the state which all outdoor enthusiasts rely upon, whether they know it or not. The Commission believes that the Department can broaden its constituency base by better marketing itself as a provider of these numerous benefits and services whenever it engages with the public, public officials, and others. The Department must also make sure that this perspective is incorporated into its normal operations in order for that marketing effort to gain credence. Having a broader base of general support will make it more likely that the Department will receive the required financial support that it needs. 5
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