Topeka ? Maybe it sounds just a little too good to be true.

Sen. Jim Barnett, who hopes to win the Republican nomination and unseat Democratic Gov. Kathleen Sebelius this year, has outlined a “Prescription for Growth” plan designed to allow the state to both cut taxes and increase spending on education during what would be his first four-year term in office.

But Barnett, of Emporia, and his running mate, Sen. Susan Wagle, R-Wichita, produced a Legislative Research Department spreadsheet to show their mix of policies would work without causing future budget disasters.

Barnett’s plan depends on its key assumptions. They’re rooted in a belief that cutting taxes actually will cause revenues to grow by stimulating economic growth – a strategy pursued nationally by Presidents Ronald Reagan and George W. Bush.

Barnett’s plan also assumes that Kansans will accept four years of frozen spending in many parts of state government and a two-year delay in the completion of some highway projects.

“This plan is ambitious,” Barnett said in announcing it. “It recognizes tough choices.”

History makes Democrats skeptical.

‘Road to instability’

Nationally, budget deficits ballooned following Reagan and Bush tax cuts, and the causes and importance of the red ink remain hotly debated. In Kansas, a mid-1990s economic boom led to big but dispersed tax cuts – and plenty of second-guessing after the Sept. 11, 2001, terror attacks.

“Barnett is going to drive us back down to the road to instability,” said Senate Minority Leader Anthony Hensley, D-Topeka.

Barnett’s plan calls for phasing in income tax cuts for individuals over four years, expanding an income tax credit for businesses for investing in machinery and equipment and eliminating estate taxes in 2008. According to his spreadsheet, Kansans eventually will save $460 million a year.

But he’d also phase in a $400 million increase in aid to public schools over four years and give high education institutions annual budget increases, while covering increases in the cost of medical services for the poor and disabled.

Barely workable

So how does all that work?

First, it’s worth noting that it barely does, even using his assumptions. Barnett’s spreadsheet shows that the state would burn up all but a few million dollars of its cash reserves by 2010 before those reserves started building up again.

Secondly, his plan assumes revenues will grow 5.5 percent a year before they’re adjusted to account for the tax cuts.

Hensley attacked on that point. In making long-term projections, the governor’s budget staff and the Legislative Research Department typically assume 4 percent annual growth.

Of course, the actual growth each year often was wide of the average. In fiscal 1995, it was 1.4 percent; in fiscal 1988, it approached 19 percent.

Reducing, eliminating taxes

Barnett believes reducing income taxes and eliminating the estate taxes are important to attracting and retaining businesses and jobs and creating sustained growth.

And Democrats will argue that while income taxes can be too high, there’s also a point at which cutting them doesn’t become a key factor for businesses.

“Over and over again, economic development leaders tell us the No. 1 thing that’s important to a business expanding or locating in Kansas is having a highly skilled, high-quality work force,” said House Minority Leader Dennis McKinney, D-Greensburg.

The Kansas Supreme Court is another issue for Barnett’s plan, because of a 1999 lawsuit filed by parents and administrators in Dodge City and Salina over education funding.

Last year, the court prodded legislators into raising aid to public schools by $290 million and said it was ready to order another $560 million in increases. Legislators cannot count on the court accepting a $400 million increase spread out over four years.

There are other questions about Barnett’s plan.

Would freezing spending in much of state government force legislators not to give state employees raises? What happens if legislative efforts to get tough on crime – some are under way this year – increase the prison population?

All are points for Kansans to ponder as they review Barnett’s plan and decide whether it makes him the best Republican candidate and a better choice for governor than Sebelius.