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P
ERKINS
10/15/09
 
8:33 PM
183
CHANGES IN A CHANGING WORLD:REVITALIZING NEW HAMPSHIRE’SDOWNTOWNS THROUGH THEECONOMIC REVITALIZATION ZONE TAXCREDIT
R
EBECCA
P
ERKINS
*
 New Hampshire recently passed a community reinvestment tax, commonly known as the Economic Revitalization Zone Tax Credit, to counter the declining rate of economicgrowth in the state. The EZ Tax credit replaces the old tax credit law, the CROP zonelegislation. However, the new legislation may not have its desired effect, This Noteargues that the EZ Tax Credit legislation does not ultimately address some critical  problems raised by its original CROP Zone legislation. After a comparison of New Hampshire and other states’ programs, the author provides some ideas with which New Hampshire may improve its tool for economic revitalization.
I. B
ACKGROUND
............................................................................................184
 
II. N
EW
H
AMPSHIRE
’
S
E
CONOMIC
H
ISTORY
...............................................185
 
III. C
HANGES IN THE
E
CONOMY SINCE
2003 S
TATISTICS
...........................186
 
IV. R
OLE OF THE
CROP Z
ONE
.....................................................................188
 
V. CROP Z
ONE
L
EGISLATION OF
2003........................................................191
 
VI. S
TATUTORY
L
ANGUAGE
:RSA 162-N:8................................................191
 
VII. EZ T
AX
Z
ONE
L
EGISLATION
.................................................................194
 
VIII. S
TATUTORY
L
ANGUAGE
......................................................................195
 
IX. L
EGISLATION IN
O
THER
S
TATES
............................................................196
 
X. I
MPLEMENTATION
....................................................................................200
 
XI. C
OMPARISON OF
CROP Z
ONE TO
EZ T
AX
L
EGISLATION
....................202
 
XII. I
MPLEMENTATION
P
ROBLEMS OF THE
EZ T
AX
...................................203
 
XIII. H
OW
N
EW
H
AMPSHIRE
C
AN
L
EARN FROM
O
THER
S
TATES
’P
ROGRAMS
..........................................................................................204
 
XIV. C
ONCLUSION
........................................................................................206
 
In 2006, New Hampshire passed a community reinvestment tax,commonly known as the Economic Revitalization Zone Tax Credit (“EZTax”), in order to “enhance downtowns and town centers with respect to
*Rebecca Perkins is a J.D. / LL.M. candidate at Cornell Law School, where she is a GeneralEditor for the Journal of Law and Public Policy. She received her B.A. from Dartmouth Collegein 2004. Rebecca is a founding member of the Dartmouth Law Journal. She is currently VicePresident of Fund Development at the International Humanitarian Foundation.
 
P
ERKINS
10/15/09
 
8:33 PM
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THE DARTMOUTH LAW JOURNAL
Vol. VII:2
economic activity, cultural and historic character, sense of community, andin-town residential uses that contribute to economic and social vitality.”
1
 This is not the first iteration of the tax, as this replaces the previousCommunity Reinvestment and Opportunity Zones Tax Credit (“CROPZones”) and makes some changes to the definition of “business activity.”With tourism as its major industry, New Hampshire has always focused onhow “land use is intimately related to community character.”
2
Now, as thestate transforms from an economy based on textile mills into a base forhigh-technology growth sectors, New Hampshire is, like many states,attempting to provide the business incentives, job training programs, andland conservation initiatives that must accompany such a transition. The EZTax zone credit is just one of many programs that are creating theseincentives.This Note will demonstrate that New Hampshire’s new EZ Zone TaxCredit legislation, while crucial to New Hampshire’s transition to a moderneconomy, does not address many of the problems raised by its originalCROP Zone legislation, including the lack of objective criteria to form thebasis of the Commissioner’s decisions and the ambiguity in many of theterms used. Ultimately, the combination of incentives that exist in NewHampshire is not aggressive enough or written clearly enough to create alarge impact. Part I will provide some basic background information aboutNew Hampshire. Part II will explain the EZ Tax Credit program in detail,as well as explain other states’ solutions to these same problems. Part IIIwill elaborate on the thesis above, including how New Hampshire’s EZZone Tax Credit will likely face implementation problems in terms of itscompetitiveness with similar taxes in other states, avenues of appeal fordecisions on qualifying property, and interpretation problems due to itslanguage. Part IV will conclude with some suggestions for the future.I. B
ACKGROUND
 New Hampshire is home to the famous “live free or die” motto. Itsculture is inherently anti-tax, and in fact libertarian by nature, meaning thatsmaller government is considered better government, as it is leaner andmore efficient.
3
The state does not levy an income tax, a condition that has
1
N.H. Rev. Stat. § 79-E:1(I) (2006).
2
Town of Newmarket, “
 New Hampshire Master Plan: Chapter 3, Land Use
,”http://www.newmarketnh.gov/content/view/293/254/.
3
“New Hampshire's state motto, ‘Live free or die,’ represents the state's Puritan mindedroots that exemplify independence, frugality, and industry. Freedom is the essence of economicindependence and New Hampshire is the best state in the U.S. to keep this independence andgrow your company. The Most Livable State, Healthiest State and Safest State annual awards aredesignated by Morgan Quitno Press, which bases its awards on extensive statistical data.” New
 
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CHANGES IN A CHANGING WORLD
185
resulted in creative tax structures and solutions that are a constant mediatopic.
4
Individuals staunchly oppose high taxes and are uniquely positionedto resist them. To add to this complex fiscal situation, the state isconstitutionally mandated to provide an “adequate” education to all of itschildren, a standard promulgated in response to a school funding crisis thatwas litigated in the Supreme Court of New Hampshire.
5
 States commonly face challenges to the procedural elements of taxcredits, as statutes rarely provide avenues for appeal.
6
This leads tonumerous suits interpreting the terms in the statute in order to provideadequate relief for the citizens of the state.
7
New Hampshire’s EZ TaxCredit statute seems destined to repeat the same cycle, since its statutorylanguage grants the Commissioner of Economic Resources andDevelopment nearly unilateral power to grant or deny tax relief.
8
Thisstatutory language is sure to provide ambiguities in implementation similarto those experienced by other states, including the basis on which theCommissioner makes his/her decisions and the amount of the creditgranted.
9
There are not as of yet any cases pending.II. N
EW
H
AMPSHIRE
’
S
E
CONOMIC
H
ISTORY
 In 1998, New Hampshire was considered to have a strong economy.
10
 From 1980 to 1996, New Hampshire’s economic output grew by 45.6%,outpacing national and regional growth in several areas includingemployment growth, low unemployment rate and poverty, family income,and median hourly wage.
11
Within the state, however, prosperity varies byregion and demographic group. The North Country’s economy has grownby only 13.6% in the same 16 year period. Single-parent families, youngworkers lacking higher education, and minorities are especially vulnerable
Hampshire Business Resource Center,
 Incentives
,http://www.nheconomy.com/recruitment/incentives.aspx.
4
New Hampshire Department of Revenue Administration, “
 Does NH have an Income Taxor Sales Tax?”
, http://www.nh.gov/revenue/faq/gti-rev.htm.
5
NHcafe, “
 New Hampshire Communities for Adequate Funding of Education
,”http://www.nhcafe.org.
6
See Section IIIc., later in the Note.
7
Id 
.
8
N.H. Rev. Stat. § 79-E:5(IV) (2006).
9
See Section IIb. Later in the Note.
10
Judith Elliott, “
The Status of Working New Hampshire: A Review Of New Hampshire DataFrom State Of Working America
,” New Hampshire Center for Public Policy Studies inassociation with the Institute for Policy and Social Science Research, University of NewHampshire, sponsored by the Economic Policy Institute, Washington, D. C., Sep. 1998,http://www.nhpolicy.org/reports/workingnh.html.
11
Id 
.
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