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Archive for Sunday, September 5, 2010

Governor candidates face expiration of federal stimulus funds

September 5, 2010

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— During the past couple of recession-plagued years, many Kansans have faced the following scenario: Their expenses have gone up while their income either stayed flat or decreased.

State government has wrestled with the same problem, and the next governor will have to continue to work on an extremely tight budget that faces a critical moment — the expiration of federal stimulus funding.

Taxes going to the state’s all-purpose general fund have decreased 15 percent from $5.9 billion in 2008 to $5 billion in the last fiscal year.

That has produced six rounds of budget cuts in a wide range of areas, including public safety, social services and education. And it has produced a temporary 1-cent increase in the state sales tax that was approved by slim margins in the Kansas Legislature and took effect July 1.

The damage to state programs would have been worse without federal stimulus funding.

Under the stimulus package, Washington, D.C., sent Kansas roughly $1 billion to stabilize its budget during the past fiscal year and the current one, according to Budget Director Duane Goossen. The state was able to use this money to prop up Medicaid, the health care program for the poor, and for education funding, Goossen said.

When the Kansas Legislature and a new governor start the 2011 session in January, they will be working on a budget for the fiscal year that starts July 1, 2011.

And as the law stands now, there will be no more federal stimulus funding available to stabilize the budget.

“That’s the big issue,” said Goossen. “The federal money for education and Medicaid goes away, and to keep the programs at the same level, the state general fund will have to fill in where the federal money goes away.”

So what will the next governor do?

The Journal-World asked both major political party candidates — Republican Sam Brownback and Democrat Tom Holland — to answer this question.

Here is the response from the campaign of Holland and his lieutenant governor running mate Kelly Kultala, who are both state senators and have been in the middle of tough budget fights all year: “Tom and Kelly were proud to have worked in a bipartisan fashion with a majority of Republicans in the state Senate to pass a multi-year revenue package to balance the budget. With the budget balanced, a multi-year plan in place and new transportation projects about to begin, we expect Fiscal Year 2012 to be very manageable. Because of the bipartisan work accomplished this past session, drastic cuts to schools, public safety and services for our most vulnerable will not be necessary.”

Brownback submitted this response. Because his response was longer than Holland’s, the Journal-World is publishing part of it in print, but the full response can be viewed at LJWorld.com.

Brownback states: “While we won’t have accurate data for the next governor’s budget until November when the next Consensus Revenue Estimate Report is released, it’s no secret that government spending in 2012 is projected to be hundreds of millions of dollars more than expected revenues. Upon taking office we will immediately institute a state general fund spending freeze and review revenue and spending estimates to take necessary steps to produce a balanced budget. We also will make use of Executive Reorganization Orders to make state government’s functions and structure better reflect the needs of Kansans.”

Comments

situveux1 3 years, 7 months ago

Would it be so difficult for the JW to specify that .4 cents of the 1 cent increase is permanent? That is the truth, saying all of it is temporary is a lie.

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