Topeka ? Two agencies responsible for improving the business climate in Kansas may find themselves out of business.

Gov. Kathleen Sebelius has recommended that the Kansas Technology Enterprise Corp. and Kansas Inc. be shut down and their functions be handled by the Kansas Department of Commerce.

Sebelius’ Budget Director Duane Goossen said the recommendation was made to make government more efficient and save money.

“We would expect Commerce would absorb the operations within its current budget,” Goossen said.

The state is facing a $186 million budget deficit, and a potential $1 billion shortfall in the coming fiscal year.

The heads of KTEC and Kansas Inc. are fighting the governor’s proposal.

KTEC is the larger of the two agencies, with a nearly $14 million budget. It was formed by the Legislature in 1986 and charged with promoting and investing in technology-based economic development.

Tracy Taylor, KTEC president and chief executive officer, said the agency’s mission is critical during the current financial crisis.

“In this kind of economic time, you need to focus on technology and entrepreneurship. There is empirical data that shows that’s what leads you out of an economic recession,” he said.

Some legislators, however, have complained about Taylor’s salary, which is approximately $280,000 per year.

But Taylor says his salary is set by a board that includes legislators, members of the state administration, university representatives and private sector officials. And, he said, it was set after a national survey of comparable positions.

Kansas Inc. is a smaller shop with expenditures of $774,321 in the last fiscal year, It has three employees.

The agency’s mission is to put together a strategic economic development agenda and evaluate whether those programs are benefiting the state.

Stan Ahlerich, president of Kansas Inc., said the agency was created to “take some of the politics out of the decisions.”

Ahlerich said Kansas Inc.’s 17-member board represents a wide range of government and private sector experience, including members of the Legislature.

He said if Kansas Inc. were abolished, all economic strategic planning would be conducted by the Commerce Department, which is headed by a Cabinet secretary appointed by the governor.

“There would be no legislators at the table,” he said.