Topeka Republican gubernatorial candidate Jim Barnett is calling for a temporary halt to the collection of unemployment taxes paid by employers in Kansas.
Barnett offered his proposal after state labor officials disclosed last week that the pool of money used to pay unemployment benefits was more than $614 million. Barnett, an Emporia physician and state senator, said continued collection of the tax puts a burden on the economy.
He said the fund would more than cover any demands for benefits and was an example of Democratic Gov. Kathleen Sebelius' "mismanagement of the Kansas economy."
"If Kansas jobs had grown at the national average during the last four years, we would have 65,000 new jobs. Instead, under Kathleen Sebelius, our fragile economy is being taxed into extinction," Barnett said in a written statement.
Labor Secretary Jim Garner said Friday there were no plans to suspend collection of the unemployment tax, which was last halted by Gov. Bill Graves in the 1990s. Garner said an advisory panel for the trust fund would be taking a closer look at its resources and making recommendations to him and the governor.
On Tuesday, Sebelius said a growing trust fund indicates economic growth and fewer people seeking benefits.
"The last thing you want to do is deplete a fund, only to find out six or eight months from now that you're going to need it. I'm looking forward to getting that recommendation" from the advisory panel, Sebelius said. "All signals are that we definitely have a growing economy."
Garner said the state has made steady economic progress since 2003, when the unemployment trust fund dwindled to $217 million as 198,000 first-time jobless claims were filed with the state. Over the last year, claims have dropped 36 percent to 127,000 as more Kansans have gone back to work.
He said it would be a mistake to abate the tax, only to reinstate it during an economic downturn when businesses are facing limited resources.
Barnett has made the state's economic health a primary focus of his bid to unseat Sebelius in the November general election. He has criticized Sebelius for lack of leadership in getting the economy on track, including signing a $541 million school finance package that Barnett says the state cannot afford without higher taxes.
He has proposed giving tax credits to businesses investing in Kansas to create more private-sector jobs, as well as reducing the state income tax rate and increasing the dependent exemption by $500 to help families.
"An unemployment insurance tax abatement when the trust fund is brimming with money just makes sense," Barnett said.