Lawrence's four legislators say they agree with Gov. Joan Finney that property taxes to finance public schools should be cut statewide, but they don't like the way she proposes to make up the $217 million in property taxes that her plan would eliminate.
Finney recommended today in her annual budget address that the state take over funding of public schools to meet a court ultimatum and that a statewide school property tax of 45 mills be imposed. Her plan calls for a standard per-pupil expenditure of about $3,640. The per-pupil expenditure in the Lawrence school district now is $3,614.98, according to district officials.
The 45-mill levy would cut current statewide property taxes on schools by 18.1 percent, reducing property taxes in 253 of the state's 304 districts. The tax cut would apply to Lawrence, where the school district now levies a property tax of just over 77 mills.
TO REPLACE the $217 million property tax cut, Finney proposed repealing $105 million of current sales tax exemptions, legalizing video lottery in the state, accelerating collection of income and other taxes and reducing the required general fund balance from 6 percent of expenditures to a flat $100 million.
Finney said she did not want to consider increasing the sales tax or income taxes. However, she told reporters Monday she would consider an upper-bracket income tax increase.
Finney's proposal to legalize video lotteries, which she estimates would raise about $30 million for public education, drew the most objection from Lawrence's legislators.
"I have a hard time passing a video lottery to help educate our children," said Rep. Sandy Praeger, R-Lawrence. "Using the proceeds from gambling doesn't seem to be the right avenue for providing education from K through 12."
PRAEGER SAID she also didn't think video lottery was a source of income that the state could rely on. And Praeger didn't like Finney's proposal to eliminate $105 million of current sales tax exemptions.
"I don't recall any of the exemptions that could be repealed to raise $100 million without getting into something pretty controversial," she said.
Praeger said she was also concerned about what will happen with capital (building) improvements once the state takes charge of funding schools. "I don't want us to create a system that makes it political about who gets a new school and who doesn't," she said. "I think that local boards need an opportunity for input. . . . I think there's a solution out there. We just need to work at balancing local control versus state authority."
REP. BETTY Jo Charlton, D-Lawrence, said she didn't think the state could count on making up most of the $217 million cut from property taxes with gambling and with repealing sales tax exemptions. She said most of the exemptions have been made for a reason.
"There are some that may have outlived their usefulness, but not many," she said.
Charlton said she didn't think the state would pick up any funding using the sales tax unless lawmakers raise the current 4.25 percent rate.
Finney's proposal would lower the quality of education in some districts by lowering the amount of money spent in those districts, she said.
"IF WE'RE going to be concerned about the quality of education statewide, as well as equality of education, we're going to have to raise more money," Finney said. "And if we're going to have to raise more money, we're going to have to raise taxes somewhere."
Charlton said lawmakers should approve a long-range, dependable source of income, rather than depend on a video lottery. Otherwise, lawmakers will be doing "year to year scrounging for funds for school finance," she said.
Sen. Wint Winter Jr., R-Lawrence, said Finney was on the right track on lowering school property taxes.
However, Winter said Finney's proposals to make up the difference "is smoke and mirrors."
"I THINK she's passed the buck to us to do that," Winter said. "I give her an A for effort and an F for follow-through."
Winter said a video lottery was defeated in the Senate last year. He said revenue projections on what a video lottery would raise are murky.
"I think to risk education with a video lottery is a gamble for our children I'm not wanting to take to reduce property taxes," Winter said.
He said the governor "dug a $200 million hole and didn't fill it back in."
Rep. John Solbach, D-Lawrence, said he viewed the governor's proposal as a starting point for the debate on school finance.
Solbach said he thinks the answer to funding the schools is an increase in the upper-bracket income taxes.
He said he several people with incomes of about $150,000 a year have told him they are not opposed to an increase in their income taxes. He said those wealthy individuals are afraid the state will no longer fund the programs that have helped to provide a quality of life in the state that have helped make them wealthy.
"I commend the governor on stepping forward with a plan," Solbach said. "I'm sure that all legislators can agree with part of that plan. We've got to be willing to compromise."