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Archive for Tuesday, February 8, 2011

Statehouse Live: Democrats say House Republican budget will hurt research at KU, other schools

February 8, 2011, 9:17 a.m. Updated February 9, 2011, 12:16 a.m.

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— House Republicans pushed through budget cuts Tuesday that they defended as responsible, but that Democrats said would hurt public schools and jeopardize life-saving research at Kansas University and other higher education institutions.

The measure would cut base state aid to schools and enact a 7.5 percent pay cut to high-wage state employees, including about 1,500 at higher education institutions.

House Speaker Mike O’Neal, R-Hutchinson, called the bill “a responsible budget that provides a positive ending balance for this fiscal year.” It was approved 81-40 with only Republicans in support. Democrats and a handful of Republicans opposed it.

House Democratic Leader Paul Davis of Lawrence said the education cuts would lead to larger classes and teacher layoffs. “Our children will suffer so that big businesses can be exempt from paying taxes,” Davis said.

And he said the pay cuts will hurt research at higher education schools and could jeopardize National Cancer Institute designation at the Kansas University Medical Center and bringing the National Bio and Agro-Defense Facility to Manhattan.

“ ... the extreme right wing has sent a clear message to leading researchers at our universities that their work is not valued,” Davis said.

The legislation essentially embraced cuts proposed by Gov. Sam Brownback, a Republican, to the current fiscal year, and will result in a reduction in base state aid to schools from $4,012 per student to $3,937 per student.

Democrats said the bill shorted special education below required federal levels, and would come back to haunt the state by resulting in special education cuts from the federal government that could total up to $25 million per year.

But attempts to add $16.7 million in special education funding were rejected twice using the House’s new “pay-go” rule that limits spending increases during floor debate of an appropriations bill. O’Neal said they “pay-go” provision worked as intended, providing budgetary “responsibility and discipline.”

Conservative Republicans added a provision in committee to cut by 7.5 percent the pay of legislators, state officers, judges and regents employees making more than $100,000 per year.

Several legislators tried to remove the 7.5 percent pay cut to high-wage state employees at regents institutions, saying the proposal would chase away top-flight researchers and doctors at KU and other schools.

State Rep. Don Hineman, R-Dighton, said researchers working on treatments for cancer and other diseases are in high demand and will be lured by other states. “If you cut these folks 7.5 percent, we are sending the message you aren’t important and you should look for other employment. They (the researchers) are a mobile commodity, and they will go,” he said.

But state Rep. Pete DeGraaf, R-Mulvane, said those receiving a pay cut should realize the state faces a huge revenue deficit. “Anyone making over a $100,000 needs to join us and the governor and experience some pain.” Legislators said Brownback has voluntarily taken a 10 percent pay cut.

Hineman’s amendment to remove the high-wage earners at regents institutions from the pay cut failed, 45-71.

The Senate is currently working on its own budget plan. After finishing work on the current fiscal year budget, the Legislature will work on a budget for the fiscal year that starts July 1. Current estimates have pegged the revenue shortfall for that year at $492 million.

During debate, abortion opponents also pushed through an amendment that would prevent the state from passing through federal family planning service grants to Planned Parenthood.

Comments

Kontum1972 3 years, 10 months ago

1,500 employees....$$$ good grief! there goes the new sports car....

question4u 3 years, 10 months ago

Engineers, scientists and doctors make a lot of money. That's a consequence of a capitalist system and the principle of supply and demand. If you want them to teach, you have to pay the going rate. That may not be equivalent to what professors of engineering, the sciences and medicine could make in the private sector, but it's just plain stupid to think that you can lower salaries to whatever you feel like paying and still hire the best qualified people. What CEO adopts that attitude? How many companies prosper by paying less than the going rate, then calling their employees overpaid and daring them to look for other options?

johnwoods 3 years, 10 months ago

I am not one of the state employees that would be affected by the 7.5% reduction, or a state employee at all. But, why should only a few state residents, who are serving the state, be the only state residents that are affected? Shouldn't all residents of the state pay more if we want to retain these services? Either make cuts across the board or raise state taxes. This will just lower the educational systems standing nationwide if we force some of our top employees to get jobs elsewhere.

Bob_Keeshan 3 years, 10 months ago

It is a great political point, but how much actual tax money goes to pay salaries over $100,000?

Probably not very much. The GOP is committed to running the state into the ground, one job at a time. With this budget, it is clear they have eliminated even more jobs.

Brownback has promised 100,000 new jobs. Where are the jobs?

JoeFriday 3 years, 10 months ago

There's a list of people who made more than $100,000 in 2009 at http://www.kansasopengov.org/StateGovernment/SG100kEarners/tabid/1551/Default.aspx

The total came to a little over $270 million.

just_another_bozo_on_this_bus 3 years, 10 months ago

"Conservative Republicans added a provision in committee to cut by 7.5 percent the pay of legislators, state officers, judges and regents employees making more than $100,000 per year."

This makes no sense at all. Is it the belief that all state employees making over $100,000 are overpaid? And if they make this determination simply because of the size of their salary, why should it be limited only to state employees?

Wouldn't it make more sense (and raise more revenue) to raise the income tax on everyone in the state who makes more than $100,000?

The answer to that question is an obvious "yes," but this isn't about making sense. This is about making an ideological statement, and handing the bill for that to people who work for the state.

jafs 3 years, 10 months ago

Well, again, his promise to protect education funding translates into cutting it instead.

And, we'll lose about $25 million in federal money for special education.

This is ok with the folks that voted for this administration, I guess.

Bob_Keeshan 3 years, 10 months ago

Amazingly, in 4 weeks and 2 days he has managed to eliminate thousands, if not tens of thousands, of jobs.

He seems to be going in the wrong direction. Instead of adding jobs, he is taking jobs away.

wastewatcher 3 years, 10 months ago

The left wing liberals are whining, they must remember that elections have consequences and they had their day and left Kansas in a h--l of a mess. As a result the voters threw the liberals out in record numbers. The people have spoken.

just_another_bozo_on_this_bus 3 years, 10 months ago

Actually, the budget problems are caused by the collapse of the economy, the responsibility for which lies squarely with Republicans. Granted, Democrats were complicit in that in many ways, and failed to fix it over the last two years (not that it was possible,) but the main message of the election is that our two major political parties are corrupt to the core, and bereft of good policy ideas.

MyName 3 years, 10 months ago

What "liberals"? Name one actual liberal from any party that holds office in Kansas? Are they required by law to have one liberal boogieman elected every year or something? The people in charge in Kansas are the exact same jokers who were in charge last year. The only difference is, instead of having a moderate, former Republican as governor, they have a religious conservative, but even he is going to blame as much of the budget as he can on the Legislature.

Alceste 3 years, 10 months ago

Oh goody, goody. I just love it when the wealthy get a taste of their own medicine and from their "friends" in government no less!

http://www.kansasopengov.org/StateGovernment/SG100kEarners/tabid/1551/Default.aspx lists all state of Kansas employees making $100k or more.

While you're at it, why not look at those making just a few bucks less than $100k....: You will want to access this data base: http://www.kansasopengov.org/StateGovernment/SGPayGrid/tabid/1553/Default.aspx to discover just how good working for the state can be....

just_another_bozo_on_this_bus 3 years, 10 months ago

So how much money "should" these people be earning? Are they overpaid merely because they work for the state? Is everybody who earns over $100,000 overpaid, or only those who work for the state?

Alceste 3 years, 10 months ago

Anybody making $100k in Lawrence, while perhaps not being overpaid, is in a position to help via an increased tax share or a reduced pay for those that are being paid under $40k. How can you possibly argue with this logic other than the fact that your buddies are used to pulling that $100k and spending it in the myriad of bistros, saloons, and brothels.

George Lippencott 3 years, 10 months ago

Of course it will. Raising taxes will also cause somebody somewhere to lose jobs. We did a 20% increase in state sales taxes last year. How about another 20%. People are seeing little or no income increases (except for KU professionals) so let us wax them with another tax increase to protect those KU professionals.

How come if we have a "star" at KU we can not selectively give him/her more money next year (July) and give less to the non-stars.

Mr. Davis please explain how raising taxes on business will not result in increased prices THE REST OF US will have to pay. Will your plan not end up an indiscriminant tax on all? Or is your proposal another example of feeding the anointed knowing there is little chance what you propose will ever happen??

MyName 3 years, 10 months ago

WTF are you talking about. It's not "20%" it's one penny more out of every dollar. You can act like that's this huge tax increase, but in that case, why is there still a $500 Million hole in the budget? And at the same time, why have retail sales gone up to their highest point since the recession? If that Laffer curve BS you're touting applied here, wouldn't they have gone down? The majority of the people wanted the tax increase because they didn't want to cut services even further during a recession. And the same people who voted for it last year, are in charge now.

And as far as the wage cuts go, what exactly is the guy supposed to say? "You're right, I think that even though we make way less than our counter-parts in the private sectore, we are still totally overpaid. Thank you for the pay cut, can I have another?"

Get some perspective.

George Lippencott 3 years, 10 months ago

My are you stupid - a sheep to be shorn. The state sales tax was 5 cents on the dollar and we increased it to six. That is an increase of 20%.

AS to whether we have hurt you I can not vote. I don't know what you do? The GAO has recently released data suggesting that the feds are overpaying some of their employees.

Now as far as KU, I really do not know what a fair wage is. I do know that there have been above inflation raises for most of the last ten years. Most of the rest of us have not seen such raises.

I only attacked the notion of the loss of quality at KU. I belive you do pay quality but that does not mean everybody. Like it or not some people are worth more to the society than others.

I know it hurts when it is you on the block - but we don't have the money. I have suggested raising Kansas income taxes to be more progressive but that old snow ball has a better chance. WE are at close to 10% on sales tax. Want to go to 11? Somewhere in there people start getting laid off because the rest of us can no longer afford to buy things because so much of our purchasing power is being cycled through government to a protected hoard - like you maybe?

Bob_Keeshan 3 years, 10 months ago

How many jobs were lost due to the 20% sales tax increase? Please point to specific data, thanks.

George Lippencott 3 years, 10 months ago

I don't believe I said that. I suggested that if we raise it another 20% we just might see some loss.

Of course you know that there is no way to produce any data to show the consequence of tax increases other than statistical data on the impact of removing money from the economy. Any good liberal will counter with jobs porotected by the increase. Of course the latter is no more defendable than the former.

I will stand on the general concept that when you remove money form the economy there is less money to feed the economy and commerce suffers. Yor will countrer with bogus numbers on the leverage of tax supported activity vs non tax supported activity. This will go on until we are all bored to death.

Bottom line it is all subjective and I am not willing to pay more tax for you to have more salary. At last until you are willing to pay more tax so I can have more income. How about we both gang up on Mr. Koch?

Sally Piller 3 years, 10 months ago

Brownback is voluntarily taking a 10% pay cut? You've got to be kidding right? He's worth between 3 and 9 million (I'm betting on the 9). Hardly a sacrifice compared to those making 100k. The man is a disaster for Kansas. My only consolation is that he will make such a mess of Kansas that there is no way he'll be elected president.

Dave Trabert 3 years, 10 months ago

MyName - Moderate is pretty much on target saying sales taxes were increased 20% last year. The state rate was increased from 5.3 cents to 6.3 cents. Yes, that is one cent on every dollar but the effect is to increase sales tax collections by $311.7 million or 18.9% (based on actual FY 2010 collections).

FYI, Kansas retail sales were flat in the first six months of this fiscal year ($15.92 billion). Tax collections are up but that's because of the rate increase. You have to divide sales tax collections by the rate for each month to arrive at taxable sales; starting with August 2010 collections, you have to use the higher rate (taxes paid in to the state last July were collected by retailers in June at the lower rate).

Bob_Keeshan 3 years, 10 months ago

How many jobs were lost?

Also, what were retail sales like the year before? Were they down or were they up?

Are flat retail sales an improvement from where retail sales had been trending?

And what was your organization's prediction as to the effect of the increased sales tax? Hint -- it was not flat retail sales, nor was it an increase in retail sales.

Dave Trabert 3 years, 10 months ago

According to the Bureau of Labor Statistics, there were 66,300 fewer private sector jobs at the end of December compared to Kansas' employment peak of April 2008. Government jobs are 400 higher than April 2008. Private sector employment has had very minor ups and downs since April 2010 but basically didn't change over the last 8 months.

Both academic studies that looked at the potential impact of a sales tax increase predicted job losses, mostly from fewer jobs being created than would have been without the tax increase. It's probably too early to say for sure the extent to which their predictions came true, but there is some interesting anecdotal data. Private sector employment hit bottom in January 2010 and started slowly coming back but the growth pretty much stopped in April - right about the time it became apparent that taxes were going up. I'm not an economist and it may just be a coincidence, but the fact is that private sector employment has been flat since the sales tax was approved.

Retail sales for the the first six months of the prior fiscal year (as the economy was hitting bottom) were off about 2% and then, like employment, starting getting a little better. In the three months preceding the sales tax increase going into effect, retail sales were essentially flat.

KPI did not make a prediction about sales tax revenues. We did, however, say that a tax increase would have a negative impact on the economy. That wasn't a prediction but more a recognition of basic economic facts. Because taxpayers have finite resources, having to pay more in taxes means they have less to spend on something else. That concept of finite resources and the uncertainty of what tax or regulatory changes are yet to come typically prompt consumers and employers to defer spending and employment decisions.

Bob_Keeshan 3 years, 10 months ago

Where is the negative effect on the economy? It is a "sales" tax, there has not been a negative effect on "sales" according to you.

Your comment does not indicate how many jobs the sales tax increase has eliminated.

Bob_Keeshan 3 years, 10 months ago

PS - According to the BLS, private sector employment in November 2010 was 1080.9. Private sector employment in April 2010 was 1067.2. You have an odd description of "pretty much stopped".

And what has happened to dreaded government jobs since January 2010?

Dave Trabert 3 years, 10 months ago

FYI, the earlier reference to $100,000 earnings posted on www.KansasOpenGov.org totaling $270 million for 2009 is correct. We just received the 2010 data from the state and will be posting it in a few days. Total state payroll for calendar year 2010 was $1.930 billion and was down just 0.25% from 2009. There were 1,960 people in 2010 who were paid $100,000 or more and total earnings for that group was $271.1 million. None of the numbers include fringe benefits - just pay.

Alceste 3 years, 10 months ago

Poppycock:

Soak the wealthy of Kansas with one tax after another. Please.

Bob_Keeshan 3 years, 10 months ago

Just to piggyback on Mr. Trabert's false comments, see for yourself at www.bls.gov

Kansas private sector employment peaked in June, 2008 not in April, 2008. Only November numbers have been calculated (December numbers are an estimate) and November, 2010 private sector employment is 62,800 less than in June, 2008.

Government employment actually peaked in January, 2009. In November, 2010 government employment is 3,600 less than at its peak.

And as stated before, in April, 2010 (the time of the job-killing tax increase) there were 21,000 fewer jobs than in April, 2009. In November, 2010 there were 8,000 more jobs than the year before.

And there were 14,000 more jobs than in April, despite Mr. Trabert claiming job growth "pretty much stopped" in April.

PS - While there are 8,000 more private sector jobs in November, 2010 than in 2009, there are 1,000 fewer government jobs than in 2009. Apparently the job-killing sales tax increase only killed government jbos.

George Lippencott 3 years, 10 months ago

Theer is absoilutely no way to sort job growth or decline related to any specific input/detraction from the economy. While we raised the sales tax we also had a major infusion of stimulus money to replace it. The effect of unquantifiable factors such as confidence is simple unknown. Will jobs be created because buisnesss feels "better" about the future? Will I reduce my savings to replace the money I would have spent on consumnption if you had not taken it for taxes? I bet you think you know and we both know you don't.

The real issue is why you shold be treated better than the rest of us just because you argue that you are better than us. Some of you people just do not know when to shut up. A 1% cut after a 15% increase, if that is all that happens to you, would be a god send. What an arrogant buncg you are!

Dave Trabert 3 years, 10 months ago

The numbers Captain K are quoting are seasonally unadjusted. I neglected to specify that I was using BLS's seasonally adjusted numbers, which are commonly used by economists to facilitate comparison of periods with dissimilar seasonal employment. Mr. Greenjeans would frown at the claim that the seasonally adjusted numbers are false, but shame on me for not clarifying.

Understanding the impact of seasonal trends and other aspects of employment trends is no simple matter. Yes, there were more jobs in April than in December...that's what happens when Christmas comes around and retailers need extra help. Thanks, Captain, for clarifying why seasonally adjusted numbers are better for examinng these types of trends.

Bob_Keeshan 3 years, 10 months ago

Where is your answer to this simple question -- You predicted a negative effect on the economy from a sales tax increase, so what is that negative effect that you predicted?

It clearly isn't what you thought it would be, and that is reduced sales.

yourworstnightmare 3 years, 10 months ago

It is important to remember that the state pays only nine months of the salary of most university faculty. The other three months come from entreprenuerial activity on the part of the faculty. If the state pays less than 100k but the faculty makes more because of their own initiative, will they still be subject to a pay cut?

Bob_Keeshan 3 years, 10 months ago

Not true, the numbers I used are the seasonally adjusted numbers available at www.bls.gov

How distinguished of you, though, to resort to name calling.

Now explain why real job growth in Kansas didn't begin until after April, 2010. Explain how there were fewer jobs in 2010 than in the same month in 2009 up until August, 2010. But in August, September, October, and November of last year there was real job growth over the previous year, something that hadn't happened since November, 2008.

Then explain how there are fewer government jobs now than two years ago, despite your protestations to the contrary. That job growth is occurring in the private sector, and it is occurring with a 20% sales tax increase.

Dave Trabert 3 years, 10 months ago

Bob - if I may - I'm just trying to defuse an obviously tense situation. I really didn't think that referring to you as 'Captain' was calling you a name...you've chosen an anonymous profile and use Captain Kangaroo as your avatar, so I thought you would appreciate the feeble attempt at humor. (I assumed Bob isn't your real name).

I don't mean to be argumentative, but seasonally adjusted private sector employment peaked in April 2008 at 1,136,700. In June, it was 1,134,500. FYI, BLS doesn't list private employment in the seasonally adjusted section, you have to calculate it by subtracting Government employment from Non-Farm employment.

Comparing December 2010 to December 2009, government jobs are down 1.7% and private sector jobs are up 0.8%. But comparing December 2010 to to April 2008, government jobs are up +400 / +0.2% while private sector jobs are down 66,300 or 5.8%. You tell me which group is better off; the one that gained 400 jobs or the one that lost 66,300 jobs.

I'm happy to discuss this with you in greater detail. My office number is 316-634- 0218.

George Lippencott 3 years, 10 months ago

In the above, we have a classic example of data and its misuse. WE measure things with micrometers and parse them with axes. Did private sector jobs peak at X or Y because of anything anybody did that we can point to with surety. I remind everyone that much of the money in our recent past government prolificacy is borrowed against our kids. If government money is so productive, why not just convert our whole economy to government. I am sure the history in the USSR will not repeat. Of course I am sure the government centered folk will argue they did it wrong and we can do it right. Maybe the above is why the taxpayers of Kansas elected an administration that is not overly friendly toward academics??

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