The Legislature wrapped up its 2012 Session this evening after agreeing to a budget compromise late Saturday night. However, two other attempts by the Senate to reach compromise – one on tax cuts and one on redistricting maps – were ultimately rejected by the Governor’s office.
“I was reminded this week of some comments Bob Dole made during his Kansas Walk of Fame induction in the fall,” said Senate President Steve Morris, R-Hugoton. “He talked about how we need to embrace civility and dial back partisan rhetoric. Dole said too much time is wasted on acrimonious exchanges that don’t advance public policy, and he’s right. Compromise on these two issues would have been good for Kansas and good for our economy. It’s unfortunate that politics got in the way of consensus.”
Over the past month, a group of Senators had been working to gain traction on a plan to reduce income and property taxes while another group of Senators began working earlier this week to resolve differences in the Senate redistricting map.
Income & Property Tax Plan
A group of Republican Senators – Pete Brungardt, Salina; Terrie Huntington, Fairway; Jeff Longbine, Emporia; and Vicki Schmidt, Topeka – put together a tax plan that would have lowered income taxes for Kansas families, eliminated a portion of the income tax for Kansas businesses, and reduced local property taxes by $180 million. Their plan would have retained certain components of the tax code that are widely-utilized by Kansas taxpayers, including the home mortgage deduction, the charitable gift deduction and the EITC.
The Senate compromise plan would have:
·    Reduced individual income taxes to 5.65% and 3.1%
·    Eliminated income taxes on businesses up to $100,000
·    Reduced property taxes through the Local Ad Valorem Tax Reduction Fund by $45 million per year for four years
·    Placed a sunset on the plan so the Legislature could monitor economic growth under the plan and consider additional tax cuts
“This plan would have cut income taxes for both families and job creators without driving the state into a deficit,” said Assistant Majority Leader Vicki Schmidt, R-Topeka. “It’s unfortunate that the compromise was not embraced because I think a lot of Kansans are concerned about the alternative.”
The alternative is a plan contained in House Bill 2117 that Governor Brownback urged the House to support. Fiscal projections indicate a $2.7 billion deficit for Kansas in the next five years if the Governor decides to sign HB 2117 into law.
“We don’t want to be like Washington,” said John Vratil, R-Leawood. “The plan in HB 2117 will take us down the same broken path that D.C. has followed for so long where they spend more than they bring in year after year, push their costs onto local taxpayers, and simply look the other way while their deficit continues to grow. We simply can’t afford to make those same mistakes in Kansas.”
Redistricting Plan
Another group of Senators – Steve Abrams, Arkansas City; Anthony Hensley, Topeka; Jeff King, Independence; Jeff Longbine, Emporia; Ray Merrick, Stillwell; Tim Owens, Overland Park; and Dwayne Umbarger, Thayer – met throughout the week in an attempt to draw consensus on a Senate redistricting map. By late Friday, the group had resolved the majority of concerns brought forward from previous maps with input from Senators and members of the Governor’s staff. The compromise map was presented to the Governor on Saturday for final approval, but was ultimately rejected after significant changes were requested.
“We were optimistic that a compromise could be found on the map that didn’t favor one political philosophy over another,” said Morris. “But, that compromise was turned down, sending the maps to the courts for final determination.”
The budget compromise reached by the Legislature this Session will add $43.7 million to the base state aid for K-12 schools; fully fund early childhood programs, such as Parents As Teachers; and fund under-market pay for public employees. The agreed upon budget reduces overall spending by $448.2 million and leaves the state with a projected $463.5 million ending balance, which meets the 7.5% ending balance required by Kansas Statute.
“The budget is a prudent one for Kansas as we emerge from this economic recession,” said Senator Carolyn McGinn, R-Sedgwick, who chairs the Senate Ways & Means Committee. “Probably the biggest disappointment has to be property taxes. Our property taxes are among the highest in the nation, which puts Kansas homeowners and business at a disadvantage. We pushed pretty hard for property tax relief this year, but we couldn’t get traction for it outside the Senate.”