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Archive for Friday, December 18, 2009

Parkinson says education budget won’t be cut further

Gov. Mark Parkinson talks with the Lawrence Journal-World about the state of the education budget Thursday. He says he will not approve any more cuts to higher education or public schools. “The one thing that is not on the table is to cut education any more,” he said.

Gov. Mark Parkinson talks with the Lawrence Journal-World about the state of the education budget Thursday. He says he will not approve any more cuts to higher education or public schools. “The one thing that is not on the table is to cut education any more,” he said.

December 18, 2009

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— Gov. Mark Parkinson said Thursday he will not approve any more cuts to public schools or higher education and that he is considering a tax increase to bridge the next revenue shortfall.

“My view is that we have cut education, K (kindergarten) through 12 and regents, as far we can cut without jeopardizing the quality of the education that we provide,” Parkinson said in an interview with the Lawrence Journal-World.

Even after five rounds of budget cuts that have affected nearly every area of state government and services, Parkinson said Kansas will still face a gap of about $300 million when the 2010 legislative session starts.

To make that up, he said, will require more federal funds, an upturn in tax revenues, new taxes or eliminating some current sales tax exemptions.

“We’re analyzing all of them, and they are all on the table right now. The one thing that is not on the table is to cut education any more,” he said.

Public schools have lost $300 million in state funding, and higher education has lost $106 million during the current budget crisis.

Higher education officials appeared to have been briefed earlier on Parkinson’s position.

“We can be fortunate we have a governor who we can all say is clearly standing behind higher education,” Kansas Board of Regents Chair Jill Docking said at the regents meeting.

Parkinson said he is also considering an increase in the state cigarette tax because it would provide more revenue and reduce teen smoking.

The state tax on cigarettes in Kansas is 79 cents per pack, while the average state cigarette tax is $1.34. But opponents of increasing the Kansas tax say many smokers will travel to Missouri to buy cigarettes to take advantage of the second lowest tax in the nation — 17 cents per pack.

Parkinson called Missouri’s low cigarette tax “archaic.” He added, “We should not allow Missouri’s very poor public policy to impact the decisions that we make.”

He also said additional cuts to the state prison system and Medicaid services to elderly and disabled people are out of the question.

“Additional cuts to Corrections will result in us having to release prisoners and, obviously, we are not going to do that,” he said.

On higher education, Parkinson said he fears cuts to Kansas University may hurt efforts by the school to secure national designation for its cancer center.

Parkinson, a Democrat, will face opposition to any kind of tax increase from the Republican-dominated Legislature.

Despite the budget crisis, Parkinson said he is optimistic.

“We have survived the greatest economic challenge that we have faced since the Great Depression. We’re now at a time when the economy is starting to turn and we can start to recover from this and, hopefully, replenish some of these cuts that have been made,” he said.

Comments

Kookamooka 5 years ago

Thank you. Our future thanks you.

davidsmom 5 years ago

“We should not allow Missouri’s very poor public policy to impact the decisions that we make.” Excellent, Gov. Parkinson. Thank you! Kansas can and should do better than Missouri.

kansasmom 5 years ago

I question the $300 million loss in State funding. Wasn't nearly all of that was recovered from the Federal stimulus money? What is a tragedy is that the state continues to fund education at a high level and cuts the physically and developmentally disable budgets. Shameful!

Boeing 5 years ago

“We should not allow Missouri’s very poor public policy to impact the decisions that we make.”

Niiiiiice. I knew I liked this guy.

jafs 5 years ago

The point is that if the tax is raised, more people may simply go to Missouri. If that happens, the higher tax will not result in higher revenues and may even lower them.

commuter 5 years ago

I think as part of the debate, school districts need to explain why there are so many districts and so many schools. It gets to a point that people need to realize that more schools mean that it takes more money to fund them.

Also, I want to know what the LEA and KEA are doing to help the districts?? From what I know about these two organizations is that they complain that they do not get paid enough and they work too much. Maybe one day the unions will wake up and realize there are people working more hours for less money and they have to perform The unions protect the crappy teachers at the expense of the rest.

saoirseglen 5 years ago

Why doesn't Kansas simply ban all tobacco products rather than tax them? Seems to me that would be an even better public policy.

Then again, it seems to be the new public policy to bleed people with higher taxes rather than demand efficiency and measurable productivity from government entities while creating governmental sacred cows that have expenses and spending increases that cannot be questioned.

Larry Bauerle 5 years ago

"more people may simply go to Missouri"

There are those of us living in Kansas who don't live close to Missouri.

Amy Heeter 5 years ago

Expected move. Make cuts until it hurts then raise taxes like they really care when it is what they always.

saoirseglen 5 years ago

I do want to clarify that I support education and helping others. However, I don't think any area of public spending should be off limits from scrutiny, especially with revenue to pay for it shrinking and the fact that raising taxes in a bad economy may make the situation worse.

kristyj 5 years ago

at least we know the governor isn't wasting state money on expensive glassware. good job.

notajayhawk 5 years ago

jafs (Anonymous) says…

"The point is that if the tax is raised, more people may simply go to Missouri. If that happens, the higher tax will not result in higher revenues and may even lower them."

Whether people go to Missouri to buy their cigarettes or not it will lower the revenues over time. Raising taxes reduces consumption. That's Economics 101, and yes, it applies to cigarettes. You can find studies easily enough on the web that show the exact relationship between increased tobacco taxes and reduced sales. And the reason it's been studied so well is that raising taxes to get people to quit is a matter of public policy in many places. That's why when the battle over S-CHIP was going on during the previous administration, Congress dropped their attempts to make it a 10-year program rather than 5 - it stopped paying for itself after 5 if you used increased cigarette taxes to pay for it.

While I agree on principle with those who echo the governor's statement about not setting our policy according to what neighboring states do, it's either a completely naive comment or one without meaning meant just to evoke an emotional response. What neighboring states do DOES affect our policies. What is the governor going to do - build a fence around Kansas with checkpoints and tobacco-sniffing dogs?

Godot 5 years ago

No more cuts, raise taxes, wait for Federal bailout. Kick the can down the road. Maybe it is time for this lame duck to resign and leave the post open until after the 2010 election. That will save a few bucks.

notajayhawk 5 years ago

kristyj (Anonymous) says…

"at least we know the governor isn't wasting state money on expensive glassware. good job."

Plastic cups - not very environmentally friendly.

kristyj 5 years ago

notajayhawk- ah yes, you are right. i'd contribute to the "Buy the Governor a Nalgene Foundation"!

Bob_Keeshan 5 years ago

jafs (Anonymous) says…

The point is that if the tax is raised, more people may simply go to Missouri. If that happens, the higher tax will not result in higher revenues and may even lower them.

This sounds good in theory but there is no data to support the conclusion.

That Kansas Tobacco tax was raised in 2003 from 70 cents/pack to 79 cents/pack.

Revenues have continued to increase on an annual basis. In fact, if you search the internet you will find that many years revenues have outpaced projections. The higher tax may reduce consumption of cigarettes, but there is no statistical evidence that it will actually reduce the revenues collected.

The suggestion is that if collections for the current year were $1 million, raising taxes would cause collections for the next year to be $990,000. The data shows that is not the case.

Such is the beauty of the tobacco tax - it increases revenues while at the same time decreasing consumption. There's nothing wrong with decreasing consumption of cigarettes.

Adrienne Sanders 5 years ago

"But opponents of increasing the Kansas tax say many smokers will travel to Missouri to buy cigarettes to take advantage of the second lowest tax in the nation."

That's just dumb. Sure, people who live right by the border will, but the rest of the state won't. How many smokers live in the counties bordering Missouri vs. how many in the rest of the state?

matix 5 years ago

"Public schools have lost $300 million in state funding"

Wait a second...were these cuts for fy 2009? Or proposed 2010... Or is this a cut in increased spending?

From Kansas.gov Education expenditures for kansas: 2008: $6.15 billion 2009: $6.4 billion

Can someone esplain this?

KSManimal 5 years ago

matix -

It's a cut per pupil. There are more students now than in 2008; so the absolute total dollar figure doesn't tell the whole story. And, it's a cut relative to what districts were told they would get when they set their budgets prior to the school year starting.

Think of it this way: You budget a certain amount to pay all your bills, based on what you earn and what your expenses are. Then, your mortgage company raises your rate (analagous to more kids, greater % on free/reduced lunches, etc.) AND your boss cuts your salary.

Your total salary might still be higher than it was last year....but if your expenses jumped relative to what you'd planned for AND your salary went down compared to what you'd planned for....you'd still be suckin' eggs.

matix 5 years ago

OK, but actually the student population only increased by about 6,000 (ksde.org), so doing the math we are spending more per pupil (09-10 vs 08-09).

Bob_Keeshan 5 years ago

matix, you may be spending more per pupil when you look at the total state spending but it is unrealistic to count special education funding as part of that equation.

Special education funds are mandated by the federal government and may only be spent on children who meet specific guidelines.

If the State of Kansas were to cut special education funding, then the federal government would stop sending its funding to Kansas.

Schools operate on base state aid per pupil. You cannot cut that operating budget and claim the state is still spending more because of the federally mandated state contribution to special ed. Those funds are dedicated to a specific purpose.

matix 5 years ago

bob, i'm simply dividing the state's expenditures on education by the number of enrolled students in public schools:

2008-09: $6.15 billion/472,866 students = $13,006/student 2009-10: $6.40 billion/478,897 students = $13,364/student

I want to see where the $300 million deficit the governor is speaking of is...

Bob_Keeshan 5 years ago

matix - I know what you're doing, and you are correct in saying you are being simple.

You are spreading a false message by creating a straw man.

If you don't want to discuss the facts of school finance, so be it. But don't poison this discussion with grossly inaccurate information that, it seems clear, you know to be untrue.

Special education funding is not available to be spent on 478,897 students. Why on earth would you divide it equally for all 478,897 students? If a school district were to spend special education funding on its operating costs, it would lose all of its special education funding.

Sad thing is it is clear that you know that, but for political reasons you are spreading false information.

matix 5 years ago

bob, what are you talking about? I see nothing in the article about special ed. The gov said (read the article) he will not allow more cuts in ed spending. The article states public schools have lost $300 million in state funding. Just doing a little digging at kansas.gov/kanview shows the state increased education spending from about 6.14 billion to 6.4 billion between 2008-09 & 2009-10. I'm only asking where the $300 million cuts are? Are they from proposed spending during 2010-11 for example? Special ed?

Centerville 5 years ago

When Parkinson says that education will lose $300 million, sane people assume that educaton will have that much less than this year. However, liberals and the ed lobby understand that education will get a lot more money, but $300 million less that they though they could get away with. Put away the violins.

Bob_Keeshan 5 years ago

matix, I'm talking about reality and I have been very clear.

Your decision to play games with school finance isn't clever, it is, as you say, simple.

Congratulations on being simple. Again, I would ask that you not continue to purport that the numbers you are flaunting are anything other than financial totals. They do not represent operating costs and they do not represent per pupil spending.

Unfortunately, you are aware of this and have decided that the best way to make your political point is to continue to spread false information. Congratulations on choose politics over policy. The children of Kansas thank you.

anon1958 5 years ago

The school districts need to quit screwing around and file a lawsuit to demand that Parkinson and the other morons in Topeka fulfill their constitutional duty to fund our schools at an appropriate level.

Everyone wins with a strong school system and everyone loses with a poor school system. Unfortunately too many Kansans are too poorly educated to understand why and how they benefit from a strong school system even if they do not presently or even ever have school age children.

Anti-education sentiment is part of a vicious cycle that only serves right wing demagogues and ironically causes the most damage to the idiots that support right wing demagogues in the polling booth.

notajayhawk 5 years ago

Bob_Keeshan (Anonymous) says…

Um, yeah. Unless of course you factor in the cost of people buying their cigarettes elsewhere, which was jafs' point. And as New York State found out:

"In addition to its direct public health impact, cigarette tax avoidance also leads to significant losses in tax revenue in New York, from uncollected cigarette excise taxes and uncollected sales taxes. In New York, cigarette sales on Indian reservations account for the majority of uncollected taxes. We estimate that if smokers in New York had purchased just 10 percent of their cigarettes from low-tax or untaxed sources in 2004, the state would have lost approximately $419 million in tax revenue during that year."

http://www.health.state.ny.us/prevention/tobacco_control/docs/cigarette_purchasing_patterns.pdf

matix 5 years ago

OMG we've had to cut $300 million in education funds (still noone can point out where), Raise Taxes!! $300 million out of $6.4 BILLION gone!! The kids need swimming pools, artificial turf, healthy lunches LOL!! When I was in school (Senior 91) we didn't have swimming pools, ran track on dirt, ate lunch that would make a soldier cry and read text books that our parents might have used. We still had some of the highest scores in the state.

notajayhawk 5 years ago

Oops, sorry, this is the comment from Bob_Keeshan I was replying to with my 4:54 post:

"Revenues have continued to increase on an annual basis. In fact, if you search the internet you will find that many years revenues have outpaced projections. The higher tax may reduce consumption of cigarettes, but there is no statistical evidence that it will actually reduce the revenues collected."

Oh, and as long as I'm back, bobbie, why don't you tell us how much statistical evidence there is that school spending correlates with performance?

ralphralph 5 years ago

He can't keep this promise. If you think things are tight THIS year, wait 'til NEXT year. Kansas is going down the tubes, and education can't escape the vortex of the fiscal toilet which is imminent.

kugrad 5 years ago

Matix, Here are a couple other reasons for the increases. The $ isn't all coming from the state. Districts have passed bonds, the mill levy has been increased (last year I think it went up another 1/2%, not all districts raised it though), and then there are federal dollars - sometimes there are title I and SPED dollar amounts that flucuate in ways I don't understand. So I don't know exactly what sources are included in the $ amounts you found online.

tomatogrower 5 years ago

"The state tax on cigarettes in Kansas is 79 cents per pack, while the average state cigarette tax is $1.34. But opponents of increasing the Kansas tax say many smokers will travel to Missouri to buy cigarettes to take advantage of the second lowest tax in the nation — 17 cents per pack."

A few years back I lived in Missouri for awhile. When I went to get my tags the woman in the courthouse was puffing away on a cigarette. And the gas station attendant in the little town where I lived was always puffing away. After living in a smoke free environment for so long, it was pretty disgusting. I'm glad I moved back to Kansas.

Bob_Keeshan 5 years ago

Total tobacco taxes collected in 2002 when the tax was 24 cents/pack: $52 million.

Total tobacco taxes collected in 2003 when the tax was 79 cents/pack (a 200% increase): $122 million.

Now maybe there's some fancy new way of doing math, but the way I learned it the state collected $70 million more in revenue after raising the tobacco tax. This would be $70 million + $1 more than "the state would actually end up collecting less revenue."

Now somebody making that argument please point to the "lost revenue." Thanks.

Godot 5 years ago

I hope there emerges a gubernatorial candidate for 2010 who vows to amend the Kansas constitution so that the Supreme Court will not have the power to dictate budgetary decisions to the Kansas legislature.

notajayhawk 5 years ago

Bob_Keeshan (Anonymous) says…

[Insert bobbie’s display of his lack of understanding of economic theory here]

Okay, bobbie, economics doesn't seem to be your forté (it's becoming increasingly difficult to figure out exactly what is), but what the heck, I'll give it a shot.

First, bobbie, you used the figure from the year the increase went into effect. One datum point does not make a trend.

Let's say you and a bunch of your friends go the Merc or wherever to buy your weekly kilogram of totally organic Brie cheese, which last week was selling for $30. When you arrive you are all dismayed to learn the price has gone to $45. You all gripe and grumble, but you have to have your Brie-fix, you're already in the store, and none of you know where else you can readily obtain the desired cheese product, so you grudgingly hand over the cash. For that week, the first week of the price increase, their revenues went up by 50%.

But by the following week, one of your friends has found a store near where he works that still sells it for $30. One has found an internet source. One has decided a more pedestrian Cheddar will meet his needs, and another has decided it's as good a time as any to cut down on his cholesterol. So there you are, the only one at the checkout counter forking over your $45, and the store's revenue dropped from $150 to $45. Not overnight, but over time.

If you Google (have someone explain what that means) the effect of cigarette price increases on sales, you'll probably come across a graph or two that have some sloping lines on them. One you might stumble over is the projected revenues from the increased federal excise tax on funding for the SCHIP program. Here, let me draw you a picture: http://www.heritage.org/Research/HealthCare/images/wm1548_chart3.gif Notice there are two lines, both sloping downward from left to right (that means they're declining, bobbie). Cigarette sales are falling off anyway for a variety of reasons. But if you look at the graph, you'll see that the line on top (the one that represents the higher tax) has a steeper slope. In the first year, the increase in revenue from the additional tax is about $1 billion, but in just ten years, the difference has fallen to just over $600 million. Still an increase, yes, but see, if the line on top has a steeper downward slope than the line on the bottom, bobbie, over time (I believe that was the terminology I used in my original post - "over time") those lines will intersect and the line on top will become the line on the bottom. The downward trend in cigarette tax revenue is accelerated by higher taxes - which is why it has been public policy for decades to increase tobacco taxes to get more people to quit smoking.

[continued]

notajayhawk 5 years ago

[continued]

I know your poor little head must already be spinning, bobbie, but it's even more complicated than that. See, there are other factors in play than just taking the numbers from immediately before and after the increase.

For one thing, the effect of higher cigarette prices on getting people to quit or cut down is approximately twice as high for teenagers and new smokers than for older, established smokers (which only makes sense). And the older ones die off, bobbie, meaning that while overall sales may drop off 4% for a 10% increase in price, since this is disproportionately new 'replacement' smokers, the effect grows over time.

And the supply and demand curves are affected by alternative products and alternative sources. People can and will buy their cigarettes from cheaper sources when a state raises its taxes (even over the internet), such as from the Indian reservations mentioned in the New York study. If you had read the study I linked to, they found that half of all smokers had bought their cigarettes from an alternative, cheaper source (from which the state received less or no revenue) in the prior year, and if even 10% of sales came from those sources the state would lose over $400 million in revenue. (Which was jafs' original point.)

Also, there are additional effects on total revenues collected than just the tobacco tax. While it may seem like you're coming out ahead with only a 7% drop in sales for a 10% increase in price, you have to remember that you're also going to lose 7% of the sales tax revenues collected on tobacco products. The funding studies for SCHIP also included a notation that the increased revenues from tobacco taxes would be offset somewhat by decreased income and payroll taxes collected from employees in the tobacco industry.

And on top of all that, it has been recognized for a long time that increases in tobacco taxes affect people of lower income disproportionately. These people have less discretionary income to begin with, and all the studies performed on the drop in sales due to increased taxes/prices were performed prior to the current economic crisis - it makes intuitive sense that with so many people having even less money to spend, all of the above effects would be exaggerated even further.

Hope this explains it for you, bobbie. If it doesn't, perhaps you might consider a return to high school to take a (very) basic economics course.

Your turn, bobbie – how about those studies that show how increased school spending correlates with performance?

Bob_Keeshan 5 years ago

jafs (Anonymous) says…

The point is that if the tax is raised, more people may simply go to Missouri. If that happens, the higher tax will not result in higher revenues and may even lower them.

Wrong.

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