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Archive for Thursday, March 19, 2009

Senate committee considers state budget

March 19, 2009, 10:22 a.m. Updated March 19, 2009, 4:07 p.m.

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— A Senate committee so far has stuck with Gov. Kathleen Sebelius’ plan to use federal stimulus dollars to bolster the next state budget, but it is departing from other proposals for avoiding a deficit.

The Ways and Means Committee expected to vote Thursday evening on a proposed budget for the state’s 2010 fiscal year, which begins July 1. The Senate expects to debate it next week.

The Republican-controlled committee has accepted the Democratic governor’s proposals to use $585 million in federal stimulus funds to help avoid a deficit at the end of fiscal 2010. Most of it would replace state tax dollars that finance government programs.

But the committee rejected proposals from her to refinance state bonds to save money short-term and to include in the budget $50 million in potential fees from developers of state-owned casinos.

That set up a possible confrontation over education funding. Sebelius’ proposals were designed to prevent a cut in aid to public schools, and some Republicans want to reduce that aid to lessen cuts elsewhere.

“It’s kind of like looking at a puzzle and trying to see what the puzzle is,” Sen. Ruth Teichman, a Stafford Republican, said as the committee discussed amendments to a bill containing the fiscal 2010 budget.

Legislative researchers have projected that the state will finish fiscal 2010 with a $682 million deficit if it attempts to duplicate its current budget without stimulus dollars. The 2009 budget, as revised by legislators and Sebelius, finances about $6.2 billion in spending with state tax revenues.

Republican legislative leaders have argued that aggressive spending cuts are the only way to truly solve the state’s financial problems. But the federal stimulus package promises to bring Kansas about $1.7 billion, making deep cuts far less attractive.

The House Appropriations Committee has endorsed a budget that builds stimulus dollars into the fiscal 2010 budget but still cuts aid to public schools by nearly $26 million, or 0.7 percent. Sebelius denounced the proposed cut in school aid.

The entire House plans to debate the Appropriations Committee’s plan Monday. The final version of the fiscal 2010 budget will be drafted by House and Senate negotiators, and legislative leaders expect it to pass by April 4.

Gambling revenues have been an issue for Republicans in both chambers. Developers for a casino in Wyandotte and Sumner counties must pay $25 million each for the right to build and operate them under a 2007 law, but the state is still taking applications.

Sebelius also proposed saving $34 million in fiscal 2010 by restructuring some of the state’s outstanding bonds. Budget Director Duane Goossen said the state would pay only interest for a year on some bonds, then spread out the year’s principle payments over 20 years.

But Sen. John Vratil, R-Leawood, said that would increase the state’s interest costs over time by $67 million. At his suggestion, the Senate committee removed the bond-restructuring plan from the budget.

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