Archive for Sunday, November 11, 2012

State officials disagree over consequences of tax cuts

November 11, 2012


Topeka — With the impact of Gov. Sam Brownback’s tax cuts becoming clearer, Democrats warn of debilitating cuts to state services while Brownback’s team says the budget is manageable.

Brownback, a conservative Republican, will send to the Legislature in January a budget proposal that “keeps K-12 fully funded (and) covers all essential services,” according to Steve Anderson, the governor’s budget director.

Democrats, however, are doubtful, given new state revenue projections released last week.

“Local schools and core services will now face deeper cuts because Gov. Brownback pushed through a tax plan whereby the workers pay taxes, but the bosses do not,” said House Minority Leader Paul Davis, D-Lawrence.

The numbers show that for the last complete fiscal year, total receipts to the state’s all-purpose general fund were $6.4 billion. But that will drop to $6.17 billion for the current fiscal year and to $5.46 billion for the next one.

When the 2013 legislative session starts in January, Brownback and legislators will make adjustments to the current fiscal year budget and then start work on the next one, which begins July 1.

Why the big drop in revenue? Tax cuts.

Earlier this year, Brownback signed into law cuts that lower the state income tax rate and exempt the owners of 191,000 partnerships, sole proprietorships and other businesses from income taxes.

Asked how Brownback will manage the projected $1 billion two-year drop in revenue, Anderson said, “We don’t anticipate cuts near that amount. I will leave that to the governor when we put the budget out in January.”

There are ways to soften that blow. The state is carrying a healthy surplus of $473 million, and Anderson has directed state agencies to submit budget requests with scenarios for 10 percent cuts. He exempted public school funding, which makes up half the state budget, from that directive. In addition, the temporary portion of the state sales tax increase that is set to expire next year could, if made permanent, produce another $262.3 million.

But extending the temporary sales tax is a politically explosive subject.

In 2010, after several rounds of budget cuts during the Great Recession, moderate Republicans and Democrats approved increasing the state sales tax from 5.3 cents per dollar to 6.3 cents per dollar, with a portion of the increase helping pay for the new state transportation plan. Under the law, the state sales tax will decrease to 5.7 cents per dollar in 2013. Those who paid a political price for approving the increase don’t think it would be fair to make the tax permanent to pay for tax cuts.

And Anderson warns against spending down the surplus, saying the state needs a cushion should an emergency occur. He cited political tensions in the Middle East and economic problems in Europe that could impact the financial status of the U.S. and Kansas.

The falling revenue projections, the proposed 10 percent cuts and Brownback’s recent statement about considering extension of the temporary state sales tax increase are among the reasons Democrats claim the tax cuts were irresponsible.

Anderson said the administration will make the tax cuts work, but he also said that the tax-cutting package Brownback signed into law wasn’t the one the governor had proposed. Rather, Anderson argued, the package was forwarded to the governor by Republican legislators.

“It was the only choice he had to sign,” he said. Democrats and moderate Republicans had urged Brownback to make another choice: veto the bill and continue working on alternatives.


Richard Heckler 5 years, 6 months ago

"Brownback, a conservative Republican, will send to the Legislature in January a budget proposal that “keeps K-12 fully funded (and) covers all essential services,” according to Steve Anderson, the governor’s budget director."

Don't believe this for one second. No way jose'. The budget will come with a proposal that fully funds public education according to the Brownback interpretation. If a "fully funded" number does show up in the budget proposal the Brownback soldiers in the legislature will proceed to destroy that proposal.

Sam Brownback and his soldiers prefer "vouchers" which is a means to funnel tons of our tax dollars to private industry. I call it money laundering.

Richard Heckler 5 years, 6 months ago

Notice throughout this LJW article the Brownback people leave a lot of questions not clearly answered. I say this is a tool to keep angry taxpayers at bay. A tool to make it appear as though all will work out according to Mom's apple pie.

Public education is a fine system that that if financially funded properly is a best bang for the tax buck. If an operation is not funded as it should be of course it will begin to appear as a failing operation. The concept that public education is not working is an orchestrated event. Why one might ask? Vouchers to fund private industry.

Republicans like Brownback began demonizing public education quite a few years ago as a failure. Why? There are billions of tax dollars going into our public education system. Private industry wants those billions of tax dollars in their bank accounts and so do their shareholders.

Paying out large CEO salaries, paying out dividends to shareholders,supporting golden parachutes and funding special interest campaign contributions with education tax dollars is reckless and negligent. And most certainly will pull money away from educating our children.

Paul R Getto 5 years, 6 months ago

They took on schools and the poor as enemies when the Commies fell. Been going on for 30+ years.

Richard Heckler 5 years, 6 months ago

The K-12 virtual school program is owned by people who support vouchers for private industry such as themselves. Keeping K-12 in our system is funding the demise of our public education system. There are some prominent names such as ultra conservative Bill Bennett who has wandered in and around Reagan,Bush and Bush administrations for years. Bennett has been a mover and shaker in demonizing public schools.

Then we have GW Bush,Jeb Bush and Neil Bush who have been promoting k-12 software for Charter schools and virtual schools throughout the USA for some years.

K12 is dominating the virtual school system = one big red flag.

Lynn Cheney and Dick Cheney believe school textbooks should be re written according to their notions or to the notions of ultra conservatives. This was a topic of discussion on an Indiana talk show in which Lynn and Dick Cheney were guests. Beware I say.

Should USD 497 be funding its' own demise? NO! K12 may be the least expensive available but not at the cost of destroying USD 497. It's not necessarily the best.

There are plenty of options. Calvert was available in some Kansas school districts. Oak Meadow may have a program. Waldorf also has an option. There are others. I suggest it is time to change.

These same names have been demonizing Social Security Insurance,Medicare Insurance and Medicaid. Corporate leaders see trillions of tax dollars in their bank accounts. It seems the demons operate within the new republican party.

question4u 5 years, 6 months ago

"In addition, the temporary portion of the state sales tax increase that is set to expire next year could, if made permanent, produce another $262.3 million.

The Kansas Chamber of Commerce already endorsed keeping the sales tax increase in order to eliminate income taxes on its members, so this seems a foregone conclusion.

Generous Kansas voters have demonstrated that they are more than happy to pay permanently increased sales taxes to make sure that the wealthiest Kansans pay no state income tax (no strings attached). After all, Kansans aren't foolish enough ignore the math and think that faith is all you need to make a billion dollar self-inflicted deficit go away, are they?

Mike1949 5 years, 6 months ago

"After all, Kansans aren't foolish enough ignore the math" Kansans generally in my opinion are famous for gullibility! If you say something enough, they will believe it! Thous, totally republican state that is heading down to a third world road mimicking states that are backwards like Louisiana and other southern states. Not to put down those states, but I've been there, definitely don't want to live there. (hehe they probably feel the same way about me!)

just_another_bozo_on_this_bus 5 years, 6 months ago

Not to worry-- Sam is a Christian, so he knows how to create things like fish and bread and money out of thin air.

just_another_bozo_on_this_bus 5 years, 6 months ago

No, I just know a christian hypocrite when I see one.

just_another_bozo_on_this_bus 5 years, 6 months ago

I'm surprised Gotland lasted as long as it did. Its posts were blatantly Nazi/Aryan Nation.

Richard Heckler 5 years, 6 months ago

--- Sam Brownback likes to give your tax dollars to wealthy corporations absolutely. In large chunks. He has given Marrs Candy $9 million tax $$$$$. He is no fiscal conservative not by a long shot. He is cutting taxes so he says yet spending big.

--- Worker's taxes siphoned off by their bosses by Jim Hightower / Thursday, April 26, 2012

--- Where is the $47 million tax dollars that belong to Kansas taxpayers? AMC subsequently has been purchased by a Chinese leveraged buyout group. Hmmmmmmm.

--- 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 non-profit, non-partisan research center, has analyzed state programs meant to create jobs, but 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.

Centerville 5 years, 6 months ago

K-12 funding has gone and will go up every year. But, if you're addicted to press-induced hysteria, don't believe it. And, for sure, don't try to find out for yourself.

jafs 5 years, 6 months ago

And, yet, it's not at the level the Kansas SC ruled the state had to fund the system, based on their constitutional obligations.

Michael LoBurgio 5 years, 6 months ago

Conservatives will own Kansas budget mess

Apart from that, there are no good options. Here are some possibilities for what could be in store:

• An extension of the entire one-cent sales tax. (Four-tenths will remain in any case, to fund highway projects.) Brownback has said he might recommend such a move, though many lawmakers are likely to object. Leaving the tax in place might be preferable to gutting schools and services, but sales taxes disproportionately hurt the poor and middle-income households. Make no mistake, if the tax increase stays on the books, Brownback will own it. His legacy will be to lower income tax rates for wealthier Kansans while raising the costs of goods and services for all the state’s residents.

• Spending the reserve fund down to zero. Unlike many states, Kansas has no constitutional requirement to maintain a “rainy day” fund. Using the $470 million currently in the bank would provide a temporary partial fix, but for one year only. Kansas’ structural budget imbalance won’t go away unless the state finds more permanent sources of revenue. Eventually the imbalance and absence of a reserve fund could affect the state’s bond rating.

• Borrowing from designated accounts, such as state highway fund. This is another one-time fix, and another sign of a state’s desperation.

• More cuts. Conservatives say it can be done. But schools have been laying off employees and cutting programs for years. Kansas state employees are among the lowest-paid in the nation. The number of developmentally disabled Kansans awaiting services is close to 5,000. The state is failing to meet its responsibilities now.

deec 5 years, 6 months ago

Please name all the departments that can be eliminated, and explain how individual people can do those tasks themselves. Thanks.

deec 5 years, 6 months ago

A;ll right. So if this board is eliminated, who determines if a person is a competent barber? Over time, clearly a bad barber will go out of business. In the interim, do unsuspecting people just suffer from bad haircuts, possible infections from cuts, or head lice?

George_Braziller 5 years, 6 months ago

The "Office of the Repealer" Brownback established is the only one I can think of.

Alyosha 5 years, 6 months ago

You appear to forget that we possess "certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness" and "That to secure these rights, Governments are instituted among Men." Specifically, in Kansas the Kansas government exists "in order to insure the full enjoyment of our rights as American citizens."

So your belief that "people need to learn to rely on themselves, not on the government" for the securing of inalienable rights has zero support or basis in the United States.

In the US, our government is established to secure our inalienable rights — and to secure them against those who would encroach on our inalienable rights to life, liberty and the pursuit of happiness.

Carol Bowen 5 years, 6 months ago

" Conservatives will own Kansas budget mess"

No they won't. They've already prepared to blame the country's poor economy if their plans go awry.

Bob_Keeshan 5 years, 6 months ago

"We don't need half of the departments in the state government."

OK, here you go, a listing of cabinet agencies in Kansas -- eliminate half:

The Adjutant General – runs the day to day administration of the Kansas National Guard, including the organization, training, and preparation of the Guard.

Secretary of Administration – manages the Kansas Department of Administration, oversees many of the administrative areas of the state's bureaus and departments, including payroll, maintenance of public buildings, and information technology.

Secretary for Aging and Disability Services - manages the Kansas Department for Aging and Disability Services, and is responsible for programs affecting the elderly and people with physical and developmental disabilities, as well as addiction and mental health programs. It has oversight of the five state hospitals.[1]

Secretary of Agriculture - manages the Kansas Department of Agriculture, mainly a regulatory agency, oversees departments that protect and educate consumers about Kansas's agricultural and livestock productions.

Secretary of Commerce - manages the Kansas Department of Commerce, charged with the creation and retention of jobs, the growth of investment, the development of communities, the increase of per capita income within the State

Secretary of Corrections - responsible for corrections in Kansas, including state prisons. Commissioner of Juvenile Justice Authority - responsible for the corrections of minors, including revention and intervention programs, community-based graduated sanctions and juvenile correctional facilities.

Secretary of Health and Environment - the largest state department with two divisions Health and Environment.

Superintendent of Highway Patrol - oversees the Highway Patrol, which ensures safety on the state's highways.

Secretary of Labor - responsible for enforcing the state's labor laws, and for educating the public about these laws.

Secretary of Revenue - oversees the collection of taxes and administers the state treasury.

Secretary for Children and Families - oversees child care, child abuse prevention and welfare programs.[1]

Secretary of Transportation - charged with providing a safe, economical, and effective transportation network for the people, commerce and communities of Kansas. It oversees the Kansas Turnpike Authority.

Secretary of Wildlife and Parks - oversees the state's game and fish industry, regulates hunting and fishing licenses, and educates the public on safety relating to the outdoors.

headdoctor 5 years, 6 months ago

The NeoLiberals of the Republican and Libertarian party are always hoping to eliminate the Government departments and agencies that maintain regulation and control. They are purposely obtuse in understanding why regulation and control was needed in the first place.

parrothead8 5 years, 6 months ago

Asked how Brownback will manage the projected $1 billion two-year drop in revenue, Anderson said, “We don’t anticipate cuts near that amount. I will leave that to the governor when we put the budget out in January.”

Translation: We don't believe in math, and we're putting off answering any questions about it for at least another few months.

chootspa 5 years, 6 months ago

They believe in math sometimes. In this case, I think the wrecking crew is intentionally sabotaging funding to push through highly unpopular and unwise legislation without enough time to discuss alternatives.

headdoctor 5 years, 6 months ago

That sounds right. The masses of Republicans wants free stuff and everyone below them should pay for it.

Alyosha 5 years, 6 months ago

There is zero evidence for toe's assertions — they are only bitter emotional projections that have nothing to do with reality. That's a bad way to go about deciding public policy.

Katara 5 years, 6 months ago

I am curious as to what stuff is free. Can you provide a list?

chootspa 5 years, 6 months ago

I hope you've got plenty of fuel to keep you through this winter. I wouldn't want you to have to drive on a free public road, especially after it's been snowplowed at no additional expense to you. If you want true "self reliance," move to an island with a deflated soccer ball named Wilson.

Joe Hyde 5 years, 6 months ago

Doggone those conservative Republican legislators anyway, giving our Governor no other choice -- no other choice! -- but to sign into law tax cuts whose grand benefits he's been trumpeting to the heavens ever since.

And now from 35,000 feet come these faint rustling noises of ownership disavowal. Could that sound be the pilot strapping on his parachute?

Doug Fisher 5 years, 6 months ago

Your the one that should leave. Go to Texas or something.

just_another_bozo_on_this_bus 5 years, 6 months ago

"degenerate, murderous filth"

I bet it really chafes on you that you can't use the n-word here (and other such words for the various "mud" people that are so inferior to you.)

jhawkinsf 5 years, 6 months ago

Just for grins, I checked the cost of living in Hawaii and compared it to Kansas. It's almost exactly double.

headdoctor 5 years, 6 months ago

If your looking for a pleasant atmosphere Gandalf, try Belize. You can have most of the perks of Hawaii and you can chose your level of living from almost nothing all the way up to costing several thousands of dollars monthly. It is much better than the coastal towns south of the border.

jhawkinsf 5 years, 6 months ago

San Pedro, Ambergris Caye. With a Belikin beer in hand.

headdoctor 5 years, 6 months ago

Why should I leave my home because of a bunch of crazies. I have a better idea. I choose to stay and push back at the crazy politicians. If I ever decide to leave it will be because I choose to, not because a bunch of politicians pushed me out.

chootspa 5 years, 6 months ago

It's the crazies who voted them in that scare me the most.

tomatogrower 5 years, 6 months ago

Isn't funny that he is all set to blame the legislature for this budget, if it turns out to be the fiasco. I just signed what they sent me. Throw them under the bus. And the head honcho O'Neil has run away to another position, so he won't be around when Kansas voters are left with a mess.

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