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Archive for Wednesday, April 25, 2012

Senate Republican leaders say Kansans want property tax relief, not income tax cuts

From right, Senate vice president, John Vratil, R-Leawood, Senate Majority Leader Jay Emler, R-McPherson, and Senate president Steve Morris, R-Hugoton.

From right, Senate vice president, John Vratil, R-Leawood, Senate Majority Leader Jay Emler, R-McPherson, and Senate president Steve Morris, R-Hugoton.

April 25, 2012

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— As legislators today resumed the 2012 session, Gov. Sam Brownback reiterated his call for significant tax reform but a trio of legislative leaders in his own party say Brownback's proposal is not what Kansans want.

In an interview with the Lawrence Journal-World, Senate President Steve Morris, R-Hugoton, Senate Vice President John Vratil, R-Leawood, and Senate Majority Leader Jay Emler, R-McPherson, said the public is not supportive of Brownback's desire to phase out the income tax.

Emler said when he has coffee meetings with constituents in his district, no one expresses a desire to cut state income taxes. "They're asking about property taxes being lowered," he said.

And they want some of the state's growing surplus — now projected at more than $600 million — to be used to restore some of the school funding that has been cut over the past several years.

The three leaders shared results of a poll of 600 likely Republican voters that was taken statewide before the start of the legislative session in January.

Asked which tax they would like to see reduced or eliminated, 45 percent of those likely voters said property taxes; 27 percent, income taxes; and 16 percent, sales tax.

Asked what should be done with the surplus, 38 percent said restore previous cuts to services such as education; 35 percent said save a portion in a rainy day fund; and 17 percent said cut taxes.

Asked which cuts should be restored first, schools got 34 percent; infrastructure/highways, 20 percent; services for the elderly and those with disabilities,16 percent; services for children and low-income families, 8 percent and public safety, 7 percent.

"There is just no public outcry to reduce the income tax," said Vratil.

Brownback's plan cuts individual income tax rates and exempts 191,000 partnerships, sole proprietorships and other small businesses from any income taxes on their business earnings. To offset the loss of revenue to the state, the plan would eliminate tax credits and deductions and keep the state's sales tax at 6.3 percent instead of dropping it to 5.7 percent in July 2013 as scheduled. In public statements, Brownback has pushed hard for the elimination of the non-wage income taxes for the wide range of businesses, comparing it to shooting adrenaline to the heart.

In a column published as legislators returned for the wrap-up session, Brownback wrote, "Now the Legislature has the opportunity to enact significant tax reform and prevent another lost decade of economic decline.

"Empowered by a tax policy that is built on liberty and rewards hard work, we can accelerate economic growth, create well-paying jobs, increase family and community stability, and reduce the number of children living in poverty.

But the three Senate leaders said they would rather see enacted a bi-partisan plan passed earlier by the Senate that would provide $180 million over four years to local governments to buy down property taxes.

Several of the tax cutting proposals in a House-Senate conference committee would remove too much revenue from the state, the three leaders said. That House-Senate conference committee picks up its work today.

Comments

Richard Heckler 1 year, 11 months ago

Pulitzer Prize-winning journalist David Cay Johnston joins us to talk about his new book, "Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (And Stick You with the Bill)." Johnston reveals how government subsidies and new regulations have quietly funneled money from the local poor and the local middle class to the rich and politically connected.

http://www.democracynow.org/2008/1/18/free_lunch_how_the_wealthiest_americans

http://www.uua.org/events/generalassembly/2008/commonthreads/115777.shtml

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Richard Heckler 1 year, 11 months ago

Hightower Report: Workers' Wages Lost to the Boss

A new study by Good Jobs First finds some major loopholes in withholding By Jim Hightower, Fri., April 27, 2012

My congratulations to workers in 16 states – from Maine to Georgia, New Jersey to Colorado! Many of you will be thrilled to know that the income taxes deducted from your paychecks each month are going to a very worthy cause: your corporate boss.

Good Jobs First, a nonprofit, nonpartisan research center, has analyzed state programs meant to create jobs, but which instead have created some $700 million a year in corporate welfare. This scam starts with the normal practice of corporations withholding from each employee's monthly check the state income taxes their workers owe. But rather than remitting this money to pay for state services, these 16 states simply allow the corporations to keep the tax payments for themselves! Adding to the funkiness of taxation-by-corporation, the bosses don't even have to tell workers that the company is siphoning off their state taxes for its own fun and profit.

These heists are rationalized in the name of "job creation," but that's a hoax, too. They're really just bribes the states pay to get corporations to move existing jobs from one state to another, or they're hostage payments to corporations that demand the public's money – or else they'll move their jobs out of state.

Last year, Kansas used workers' withholding taxes to bribe AMC Entertainment with a $47 million payment to move its headquarters from downtown Kansas City, Mo., to a KC suburb on the Kansas side, just 10 miles away. What a ripoff! Among the 2,700 corporations cashing in on such absurd diversions of state taxes from public need to private greed are Goldman Sachs, GE, Motorola, and Procter & Gamble.

For more information – and for ways you can help stop this despicable giveaway – get the full report, titled "Paying Taxes to the Boss." It's available at www.goodjobsfirst.org.

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Dave Trabert 1 year, 11 months ago

If anyone would like to get together and discuss these issues in person, I will be in Lawrence Monday afternoon. Write to me at Dave.trabert@kansaspolicy.org and we can set a time and place.

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Lynn731 1 year, 11 months ago

Hell yes I want property tax relief. I am retired and they are trying to tax me out of my home.

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FalseHopeNoChange 1 year, 11 months ago

Can "I" get a property tax relief and income tax cut? Why one or the other?

These government sponges are mean. I earn it. They take it to spend "willy nilly"

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streetman 1 year, 11 months ago

Could triple the amount spent on our schools -- more teachers, more "necessities" like pools and duplicate HS football stadiums, etc -- not going to make much difference in what is learned and "test scores." The key is personal discipline -- student commitment to learning, and parents who actually take an interest in getting/keeping their children committed. That's the secret to those countries/cultures that beat the US globally on achievement -- in their own countries or within the US.

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William Weissbeck 1 year, 11 months ago

If these moderates were smart and truly dedicated to service to the state, they would reach across to Democrats and seek to form a third party in Kansas. The Democrats are all but dead by being marginalized and demonized. Because they have so few seats to run in, they don't need to waste much in resources there. But they can help by using those resources to aid the campaigns of like minded souls. Plus it would send a strong signal to the majority moderates in the state, that the moderates are disavowing the extreme positions of the current GOP power structure and will no longer be beholden to them, the extreme gun lobby, the extreme pro-life lobby, the extreme anti-tax lobby, etc. The Populists took over the state in the 1890's. Kansas is in need a of a similar pro-citizen, anti-control freaks revolution.

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4getabouit 1 year, 11 months ago

Let me be the first to pledge one dollar for the "Help Send Liberty275 Back To Florida Fund (HSLBFF). Or, you could just abandon your house here like your fellow buddies in Florida do.

It will be tough but hopefully Kansas can survive without old L275.

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Michael LoBurgio 1 year, 11 months ago

A Kansas House tax committee passed a bill in which anyone making more than $250,000 — about 21,000 people — will see a $1,500 cut, according to Kansas Department of Revenue!

The hike would come from the elimination of tax credits for Middle class and Poor!

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Liberty275 1 year, 11 months ago

Cut budgets, cut property taxes and delete the concept of state income tax. Just-another-Bozo-with-his-hand-out won't like that idea, but I don't care what he likes.

My first year here was shocking, after living my working life in Florida which doesn't feel compelled to tax it's residents because they have a job. I was also surprised to pay tax on food in grocery stores. That is insane.

Before all of you tax-lovers tell me to not let the door hit me, trust me, as soon as the housing market comes back, I'll be heading south. If I wasn't invested in a house, I'd have left 10 years ago.

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nativeson 1 year, 11 months ago

The majority of property taxes are spent at the local level to fund city and county government. If you want real relief on taxes other than income, focus on your local officials that control most of your property taxes, water, sewer, trash and other rates.

The idea that the state has a surplus to spend is overstated. KPERS is at least $10 billion underfunded. Regardless of what is done with new state employees, the deficit must be funded in some fashion over-and-above employee contributions. The state for the first time in several years is actually scheduled to pay its obligations to school districts and KPERS funding on time from its pooled money investments.

Cutting income taxes at this point is a huge risk. The success of this plan assumes significant growth in population and jobs in the state over the next 5 years. Tax policy is one among a number of economic drivers in the economy. Economists are now very mixed in their opinion about the potential growth in the national economy. If GDP grows at 1-2%, this plan will lower revenues significantly. I am very uncomfortable saying with any certainty that we have robust economic conditions in our near future.

Would you run your household budget in this fashion? Likely not.

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pittstatebb 1 year, 11 months ago

I will share what my district did to increase student acheivement on the HS mathematics assessment.

1) Hired a fourth math teacher. 2) Doubled the time that struggeling students spent in a math class (double blocked) to 410 minutes a week. 3) Aligned our curriculum to match the KS mathematics curriculum not what the textbook had in it. 4) Did away with Pre-algebra at the high school level and started almost every student in Algebra I, then Geometry, then Algebra II. I say almost because some of our special education students take Pre-algebra through a resource math class. 5) Tested our brightest kids as freshmen so they never had to worry about state assessments again (our 9th in Geometry).

We started out at a passing rate of 38% the year before we made these changes. We now average about a 90% passage rate and have made standard of excellence 5 years in a row.

I will leave you to make decision if it took more $ to achieve our turn around.

PS: In the past two years, due to budget cuts, we have had to cut 1.5 math teachers at the HS level and 0.5 at the middle school level and undo our double blocks as we transition to a traditional schedule (260 minutes a week instead of 410). How it affects our performance on state assessments? We will find out next year.

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pittstatebb 1 year, 11 months ago

I will state this for the entire forum.

NAEP is only given at the 4th and 8th grade levels. The standards used to write the questions on these tests have not changed (as Dave has correctly pointed out). However, since we also take state assessments at grades 3-8 and HS (with different standards) and the ACT/SAT for many HS students (with different standards), no school in any state is spending an ounce of energy developing curriculum that matches the NAEP. Nor is the NAEP now aligned with the 50 different sets of state standards (and they vary widly). This leaves us basically with a test that may or may not be testing material that is taught in the 4th or 8th grade (for example what I teach in 8th grade in KS may be taught in 6th grade in MO, or vice-versa).

IMO, the NAEP is simply no better than a standardized intelligence test. When we transition to Common Core standards and assessments we will get a little better on assessments. With the exception of 5 states (Minnesota, Nebraska, Texas, Virgina, and Alaska), the standards taught will be the same at each grade level. Also these 45 states are split between two different groups (SBAC and PARCC) that will be giving the same test (one group the SBAC test and one the PARCC test). We will finally be close to being able to compare education state to state and have a significantly more rigorous test to observe long term growth.

I am making no judgement on whether increased spending in KS has increased student achievement, just as I believe Dave should not be making the arguement that increased spending has NOT increased student achievement. Without using state assessments, there is simply not a valid testing tool to do this. But you can look up the state assessments scores in KS and make your own judgement :)

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verity 1 year, 11 months ago

Many thanks to all those who took the time to do the research and to prove Mr Trabert wrong. Job well done.

I believe that Kansans have seen what the extreme ALEC members---they may like to call themselves conservatives, but they're not, they're radical reactionaries---are trying to do to the state and Kansas will once again return to being moderate and progressive. These extremes have never been the majority, but they have managed to manipulate the system. Now that people have seen what they're up too, we have the push back. Kind of like with the school board and evolution.

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gudpoynt 1 year, 11 months ago

I find it interesting that these three legislators spoke up about this AND the redistricting business. Could there be a mutiny of moderates afoot in the KS "GOP"?

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JackMcKee 1 year, 11 months ago

ALEC/Brownback are in serious damage control mode right now, as evidenced by a paid shill for ALEC making the rounds on internet message boards. I've never seen anything quite like it before. Dave, how do you feel about significant erosion of your support in the business community? Maybe that should be a canary in the coal mine for your organization.

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deec 1 year, 11 months ago

"There simply is no correlation between achievement and high spending. " Great! Let's cut all politicians' and corporate executives' salaries 95%. State department heads should make minimum wage. Part time state legislators and lobbyists can work for free.

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jafs 1 year, 11 months ago

I really like how DT leaves out the quality of schools, infrastructure, etc. in the states that are spending less.

I'm sure there are possibilities for improvement in efficiency in government, and I'm greatly in favor of those, but I would be just about willing to wager that when the government spends less on schools, etc. the quality of those declines.

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JackMcKee 1 year, 11 months ago

One thing the income tax "cutting" (it's in quotes because it's not actually a tax cut, but a tax shift from rich to middle class/poor that Brownback proposed) crowd has proven, they have no problem lying through their teeth and perverting any statistic available to further their nefarious agenda. The residents of Kansas will not be sold out to ALEC without a fight.

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Dave Trabert 1 year, 11 months ago

In response to several questions from Tomatogrower...

Any impact on services related to tax reform will be determined by how government chooses to analyze the opportunities. States with lower tax burdens all have schools, highways, etc. but they provide those services more efficiently. Taxes are determined by spending...the more you spend the more you have to tax.

The states with no income tax spent $2,444 per resident in 2010. The rest of the country spent 46% more per resident. Kansas spent $3,216 per resident and would have saved $2.2 billion by providing services at the same cost as states with no income tax. $2.2 billion is nearly all of the individual income tax collections in Kansas.

Kansas needs to go through an exhaustive review of every program and agency to determine which are effective, both functionally and from an efficiency standpoint. Once programs get started in state government, they are rarely reviewed in that manner. They just keep getting funded.

There would also be new revenue coming in. Oklahoma cut its marginal rate several times and seen sales tax revenue increase by letting taxpayers more of their money. Income tax rates would be phased out over a period of years, so new residents attracted and unemployed people put back to work would pay income tax for several years.

There will always be good questions (like yours) and no guarantees but one thing is pretty much for certain: if we keep doing what we've been doing, we can expect to continue to fall farther behind.

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George Lippencott 1 year, 11 months ago

Amen. Tax the rich with a more progressive income tax. Reduce dependency on the property tax. Capitalism does not depend on the rich getting all the goodies. The middle invests too, when we let it keep some of what it makes.

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Cant_have_it_both_ways 1 year, 11 months ago

If Obama wants taxes to be fair, then why do 50% not pay any income taxes.

I am sick and tired of moochers. We have more than our share in Lawrence.

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Scut Farkus 1 year, 11 months ago

Allowing reserves to pile up and then reducing taxes is a GOP platform that has stood for years. It plays well during election years. The down side is the lack of social services. The poor, the handicapped and the sick get the shaft, but they don't represent a strong Republican voting base so they are ignored.

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autie 1 year, 11 months ago

I think you guys out manuvered Dave and he moved on. I like that all his sources are from Associations..those business type things...who's business is lobbying in one form or another. Thank you pittstate for a dose of reality.

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tomatogrower 1 year, 11 months ago

Are these Republicans listening to the people instead of their handlers, like Brownback does? Actually, I agree with the food sales tax being cut out. That helps more people than the others. If you cut a landlord's property tax, he isn't going to lower the rent. He'll just pocket the profit.

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Dave Trabert 1 year, 11 months ago

Please provide your source for the facts you heard regarding small businesses. Testimony provided by small business groups all strongly favor tax reform...Wichita Independent Business Association...Topeka Independent Business Association...National Federation of Small Business.

Kansas has a very uncompetitve state and local tax structure that has been and will continue to cost jobs.

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deec 1 year, 11 months ago

Oh goody. The ALEC/AFP guy is assigned to work the Lawrence beat today.

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kernal 1 year, 11 months ago

Good to know we still have some intelligent Republicans in the KS Senate.

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Dave Trabert 1 year, 11 months ago

It's no wonder that Kansans want property tax reform. Tax collections statewide increased 99% between 1997 and 2011, while inflation was up 37% and population about 10%. There is no good justification for these large increases.

But this is mostly a local government issue. The state only collects 21.5 miils (20 for schools and 1.5 for building funds). The other 110 mills (state average) goes to local governments and school districts.

Property tax details for each county are at http://www.kansasopengov.org/PropertyTax/tabid/1264/Default.aspx

It's also no surprise that a poll asking leading questions would conclude that people want the state to spend reserves on more school funding. The answer to a simplistic question of that nature will be based on participants' understanding of the facts; if they are misinformed, they will give misinformed responses.

Here are some facts that are conveniently ignored in most discussions of school funding. Every fact comes from the Kansas Dept. Of Education; 2012 estimates were provided by Deputy Commissioner Dale Dennis on November 9, 2011.

2012 is predicted to be a record-setting year, with total spending of $5.672 billion.

State aid in 2012 is $3.157 billion or $6,931 per pupil...that is more than double base state aid.

Recent declines in state aid have been grossly overstated. 2012 aid is only 4% below the 2009 peak but is 34% higher than in 2005.

Instructional (classroom) spending increased 87% between 1999 and 2011, more than double the combined rates of inflation (32%) and FTE enrollment (1%).

Cash reserves in current operating funds (excluding capital outlay, federal and bond payment funds) were a record-high $868 million at the beginning of this year and 90% more than in 2005. The balances increased more than $400 million and represent state and local tax dollars that were not spent.

Districts had no cash flow problems when they had $500 million in reserve. They could and should spend some of that money left over from prior years.

District-level details on spending, revenues, cash reserves and payroll listings are available at http://www.kansasopengov.org/SchoolDistricts/tabid/1265/Default.aspx

The Senate's plan to increase school funding by $74 million would reduce the State's ending balance...its reserves. How is it logical for the Sate to spend reserves but not school districts, especially since districts' reserves are far greater than the State's?

The Senate plan is not logical...or prudent. It is political.

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OonlyBonly 1 year, 11 months ago

Oh, this is a no-brainer. So these Legislators talked to homeowners who want their taxes cut. When the talked to non-homeowners they were interested in income tax and sales tax cuts. Jeeezzzzzzzz, how many are gonna fall for this bait-switch tactic. I don't own a home so I sure in heck do NOT want property taxes cut. I want cuts that will help me AND bring additional employers into the state. Jobs is the important thing not relief only for homeowners.

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autie 1 year, 11 months ago

I guess I'm not the only one who realizes that tax cuts for all those small business people only puts a bit more money in their pocket and doesn't create jobs.

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jafs 1 year, 11 months ago

Not only did several R legislators disagree with BB, they did so on the basis of a poll of likely R voters.

Interestingly, about 73% of those favored either restoring funds to services, like education, or saving the money, rather than giving it back in tax cuts.

Those are rather reasonable ideas - it's too bad that the extreme right will dismiss those people and ideas in favor of continually cutting taxes.

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kansanjayhawk 1 year, 11 months ago

More government is not the answer to our problems! We need to encourage the private sector to create jobs by creating the kind of business climate that does that. Lower all tax and reduce the size of all levels of government.

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autie 1 year, 11 months ago

Jeez, what do you think this is, a representative democracy? Nah..the corporate oligarchy knows better what is good for Kansas so sit down and shut up and enjoy the ride.

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chootspa 1 year, 11 months ago

Damn straight. We're taxing little old ladies out of their houses, and we're shooting ourselves in the foot by cutting those other programs.

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SouthWestKs 1 year, 11 months ago

Boy you did good, you picked the senate leadership, all three are RINO's.. Hopefully they will be gone in November.. Hope you are enjoying the nice weather..

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gccs14r 1 year, 11 months ago

Our universities are priced out of reach of most Kansans and their buidings are crumbling before our eyes. I don't think a tax cut is going to fix that.

If you must cut a tax, remove the sales tax on food. That will do the most good for the most families. Make up for it with a tax increase on incomes over $250k.

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