State-Level Institutional Capacity Assessment
NH · Gov. Kelly Ayotte (R) · diversified services
Population
1.4M
GSP
$105B
Total Budget
$7B
Budget / capita
$4,659
Legal Regime
Home Rule
Binding Constraint
Systematization · Primary constraint
Building state-level innovation infrastructure within New Hampshire's minimalist state-government model (no income or sales tax — 'Live Free or Die' framework systematically constrains state capacity, pushing service responsibility to municipalities). NH has CIO Goulet + DoIT consolidation (2004) — but with 2 innovation markers, no CDO, no innovation office, no R4A certification, and 65% pension funded (low for NE), institutional capacity is intentionally thin. Cluster B work under the Ayotte divided-govt context is incremental and operationally focused.
6-Dimension Assessment
New Hampshire is the only US state with no broad-based income tax AND no sales tax — revenue comes from business taxes (BPT/BET), property tax (local), liquor monopoly, lottery, and meals/rooms tax. The Manchester-Nashua corridor anchors finance (Fidelity), defense electronics (BAE Systems), and biotechnology. Portsmouth seacoast operates on tourism + naval shipyard. The Lakes Region and North Country depend on tourism. NH has full public-sector CB, decent merit civil service, and AA+ bond ratings — but pension funded ratio (65%) is among the lowest in New England. The 'Live Free or Die' fiscal philosophy creates structural underfunding of state services that gets pushed to municipalities (highest property tax burden in US). Ayotte R (2025–) faces D state senate — divided govt; constraint on policy ambition.
Peer States
Maine
Systematizationdiversified services
Vermont
Anchor-Dependentagriculture tourism
Idaho
Anchor-Dependentfederal installation dependent
Peer states share structural profile (cluster, scale, archetype). Peer match is intra-level — states match states.
Innovation Pathway Recommendations
Establishing and resourcing a state-level digital service team (NJ OOI, CA ODI, GA Technology Authority, MN IT Services, UT OOI, FL Digital Service) to modernize benefits delivery, citizen-facing portals, and inter-agency data exchange. Draws on the USDS / Code for America playbook applied at state scale, the Beeck Center's Digital Government Network (formerly Digital Service Network, merged early 2026), and Bloomberg's What Works Cities adaptation.
For Cluster B (Systematization)
For Cluster B states, stand up a digital service team if absent (5-15 FTE), audit the 5 most-used citizen services, and ship measurable improvements within 12 months. Use the Beeck Center DGN as peer-benchmarking network.
H1 absorption pattern: 'state digital transformation' becomes a multi-year ERP procurement that ports paper processes to PDFs without changing the underlying service experience. Healthcare.gov pre-rescue is the canonical case at federal level; CMS-funded MITA Medicaid IT projects are the state equivalent. The H2+ test is whether the state is building durable internal digital service capacity or just procuring vendor-led platforms.
Restructuring how state government hires, classifies, pays, retains, and advances its workforce. Draws on the federal CHCO Council reform agenda, Recoding America Fund priorities, Beeck Center research on state digital service workforce, and the 30+ states (Maryland, Indiana, Pennsylvania, Colorado, Georgia, Tennessee, others) that have removed degree requirements for state jobs.
For Cluster B (Systematization)
For Cluster B states, target the 10 hardest-to-fill roles, redesign those job classifications, and run a 90-day hiring pilot. A single visible win builds appetite for system-wide reform.
H1 absorption pattern: civil service 'modernization' becomes a fellowship program that brings in technologists for 2 years, then loses them all to private sector and reverts. The H2+ test is whether the underlying classifications, pay schedules, and protections have actually changed for the permanent workforce — not just a graft-on accelerator that the agency culture rejects when grant funding ends.
State Community Context
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Data as of Compiled May 2026; USAFacts FY2023 · high confidence
Sources · Data as of Compiled May 2026; USAFacts FY2023 · high confidence
The Civic Infrastructure Diagnostic Framework’s structural elements — the four cluster labels, the six capacity dimensions, and the binding-constraint framing — are licensed under CC BY 4.0. Anyone may use or adapt them with attribution. Tool implementation and full article text © 2026 JTV Advisory LLC.