Nathan White, chief financial officer for the Department of Health and Human Services, told the Health and Human Services Oversight Committee on May 16 that the department expects an estimated $60 million general‑fund lapse for the current state fiscal year and is preparing for additional reductions in the 2026–27 biennium.

White said the legislature’s “back of the budget” language currently contemplates about a $23 million general‑fund reduction each year of the next biennium that the commissioner will be required to implement through expenditure reductions. He also said DHHS is planning for a roughly $30 million reduction to personnel costs — which he estimated would affect about 400 positions — and has put a hiring freeze in place for many non‑direct‑care roles.

The lapse is the amount the executive and legislature assume will not be spent and therefore will revert to the state; White said DHHS represents nearly half of the state budget and that many lapse drivers are tied to service utilization (for example, child‑care scholarships, foster care and choices for independence services) and to contract deliverables rather than salaries. He emphasized that DHHS personnel account for about 10 percent of the department’s budget and that about 54 percent of that personnel spend is general funds.

White described contract spending as another major driver of lapse. He said DHHS has large contract obligations for fiscal years 2026 and 2027; the department pays only for services received or contracted deliverables and generally does not make advanced payments. That causes some contract budget authority to lapse at year end when services have not been delivered.

On staffing, White said DHHS currently has roughly 3,200 authorized full‑time positions and a vacancy rate of about 14.5 percent. He said the department exempted direct‑care positions from the hiring freeze and uses a central team to review postings in anticipation of the personnel reduction so the department will not be overstaffed when the new biennial budget takes effect on July 1.

Committee members pressed White on how lapse money can be transferred. White cited RSA 9:16‑a (transfer authority within accounts and class lines) and explained statutory limits on transfers without fiscal committee approval; he described a department‑wide transfer process submitted to the fiscal committee about three times per year and said transfers above statutory thresholds undergo public review by the governor and executive council.

Why it matters: DHHS is a central cost center for the state. White’s presentation identifies the particular program features — service utilization, contract deliverables and the timing of appropriations across a two‑year biennium — that make lapse management and personnel planning consequential for budget decisions.

The committee requested the department continue regular updates on lapse estimates and personnel planning as the legislature finalizes biennial budget language.