Archive for Sunday, June 2, 2013

Republicans approve tax, appropriations bills to conclude legislative session

June 2, 2013


— Republican legislative leaders mustered majorities to push through a $777 million tax increase and a state budget that cuts funding to higher education and corrections before adjourning the 2013 session early Sunday morning.

The actions ended the session after 99 days of sometimes contentious wrangling within Republican majorities.

On the tax issue, the Legislature sent Gov. Sam Brownback a bill that would set the state sales tax at 6.15 percent instead of allowing the rate to fall to 5.7 percent on July 1, as was required by law when a temporary sales tax rate was enacted in 2010. The Senate approved the measure 24-13, and the House, 69-45.

The tax package, which received support only from Republicans, would also cut itemized deductions by half, reduce the standard deduction, and ratchet down income tax rates.

"It is an absolute tax cut," said Gov. Sam Brownback, who endorsed the plan. But after five years, the bill will increase taxes by $777 million, according to legislative staff.

Senate President Susan Wagle, R-Wichita, and House Speaker Ray Merrick, R-Stilwell, said the reductions in income tax rates would drive economic growth.

"People are going to look at this all over the nation," Wagle said.

But Democrats said raising sales taxes and lowering deductions to support income tax rate cuts shifted the tax burden onto low- and middle-income people to benefit the wealthy.

Some legislators said not allowing the sales tax to drop to 5.7 percent represented a broken promise to Kansans.

Under the tax bill, charitable contributions will still be an allowed deduction.

The standard deduction would be cut from $9,000 to $5,500 for head of household and $7,500 for married, filing jointly. The plan would reduce over five years the top income tax rate from 4.9 percent to 3.9 percent, and the bottom rate from 3 percent to 2.3 percent. After 2018, state revenue growth over 2 percent would go toward further income tax rate reductions.

On the budget, the measure called for cutting higher education by approximately $66 million over two years. The plan included a 1.5 percent across-the-board cut for each of the next two years, and a cap on salary expenses.

And for the next school year, the budget provides flat funding for public schools despite a court ruling that says the Legislature should increase school funding by approximately $500 million. The state has appealed that decision to the Kansas Supreme Court.

The state budget received the minimum required 63 votes in the House after Speaker Merrick kept the roll open for about 20 minutes and six Republicans switched from voting against the budget to voting for it. No Democrats voted for it. In the Senate, the budget got the minimum required 21 votes, again with only Republican support.

Some legislators criticized the budget for cutting $6 million from the Kansas Deparmentt of Corrections. State Sen. Greg Smith, R-Overland Park, said the cut would make Kansans less safe. "We are putting people's lives in jeopardy with this budget," Smith said.

During the budget debate, one of the major disputes was over a plan by the Brownback administration to place the long-term care of those with developmental disabilities under KanCare, the state's new Medicaid program that is administered by for-profit companies.

Many parents of children with developmental disabilities have opposed that move, saying they believe the assistance their children receive will suffer under KanCare.

Advocates for those with developmental disabilities wanted to "carve out" long-term care services from KanCare, but GOP leaders wouldn't allow that in the budget.


Mike1949 4 years, 11 months ago

"People are going to look at this all over the nation" and laugh at the stupidity that elected people by the people can really be!

question4u 4 years, 11 months ago

"'People are going to look at this all over the nation,' Wagle said."

Of course they are.

They will be asking, did they really raise taxes on workers so that business owners don't have to pay state income tax? Do they really believe that raising $777 million in new taxes is not a tax increase? Did they really make no provision for K-12 education funding when a lawsuit is pending and there is every reason to believe that the state will lose just like before? Did they really cut funding for prisons? Did they really cut funding for their universities, none of which is among the top 100 nationally? Are they really as backward as they look?

They will see what the Kansas Legislature has done and will ask, who wants to live in a third-world state? If the rest of the nation wanted to be like Kansas, we'd have President Rick Santorum making it so.

Sorry Ms. Wagle. but your implication that people nationally will be envious of Kansas is about as convincing as your prediction of an 80-day legislative session.

Pete Kennamore 4 years, 11 months ago

yes because it is vital that tax payers subsidize your home ownership

skull 4 years, 11 months ago

Yes because it is vital taxpayers subsidize your business... They picked winners and losers. It seems anyone who has invested in anything in Kansas that is not a private business just got hosed. Glad to see my taxes raised so my boss doesn't have to pay ANY income tax whatsoever. What's that saying about "skin in the game"?

tomatogrower 4 years, 11 months ago

What? If anything my house is a boon to the state. I work hard and spend plenty of money keeping it attractive not just for me, but also my community. Studies show that home ownership has many positives, children develop community skills in a neighborhood, houses are taken better care of, and it's a really great asset if you have one that's paid for by the time you retire.
Landlords will still get to continue to take deductions for business expenses. Oh wait. Landlords just have to be set up as a corporation, and they don't have to pay taxes at all. Will they hire more carpenters to make their rentals really nice? Will they replace windows to make it more energy efficient? Will they organize community events to bring a neighborhood together? No, they will pocket the money. They will get richer, while the community gets poorer, in more ways than just money.

appleaday 4 years, 11 months ago

Gimme, gimme, gimme is what business owners say -- gimme the roads, infrastructure, police, fire, educated I can have a business and not pay income tax.

fourwinds 4 years, 11 months ago

I am ok with the elimination of the mortgage interest deduction - it will keep people from buying homes that they can't afford. This will most likely create a slow down in the real estate market - realtors will make less and high priced house sales will decline - so most likely this will add to the slow and stall of our economy - very few will truly benefit - namely the already VERY wealthy - thus leaving the state in the hands/influence of a very few - which is sad.

tomatogrower 4 years, 11 months ago

They will say that the income tax rates were decreased too. But when they get rid of our deductions, we'll be paying the same or more in taxes. They know how to lie well. Make sure people understand that this is a tax increase. They will be paying more in taxes, unless they are business owners.
Big business could care less, they will keep the money. Small business owners won't save enough money to hire lots of people, and they wouldn't hire them anyway, just to create a job. If they don't have the business that requires an extra worker, they aren't going to hire someone just to make the Republicans happy.

oldexbeat 4 years, 11 months ago

Koch Brothers don't have mortgages, no doubt. So they don't need a deduction -- note -- a deduction to help people own houses -- owners probably take better care of their property, thus protecting property values for the whole block, etc. -- and they eat only beans or such, so Koch Brothers don't care about the highest sales tax on food.

So Sammy doesn't have to do anything about those taxes since his owners don't pay them much. OK ...

Richard Heckler 4 years, 11 months ago

"Senate President Susan Wagle, R-Wichita, and House Speaker Ray Merrick, R-Stilwell, said the reductions in income tax rates would drive economic growth."

Wrong again.

Jobs jobs jobs that which pay no less than $17.50 per hour or $64,000 salaried will produce economic growth. None of this average wage nonsense that could actually represent a lot of people at minimum wage.

The state and national GOP are soooooo much alike. A lot of time spent stonewalling and zero jobs programs. Tax cuts have never driven the USA economy and produce the same results as big time layoff's and job outsourcing = a tanked economy.

deec 4 years, 11 months ago

"As we have written before, the nonpartisan Congressional Budget Office released a report in August that said the stimulus bill has "[l]owered the unemployment rate by between 0.7 percentage points and 1.8 percentage points" and "[i]ncreased the number of people employed by between 1.4 million and 3.3 million."

deec 4 years, 11 months ago

The point is the stimulus did, in fact,create jobs. It probably helped hold down the increase in welfare spending by providing people who otherwise would qualify for benefits with those jobs conservatives are always shouting about.

deec 4 years, 11 months ago

"Of course it created some temporary jobs," Then why did you say earlier "Where are all those jobs?" I guess you must know everyone in the country, huh?

skull 4 years, 11 months ago

And the infrastructure that money created was free, right?

Richard Heckler 4 years, 11 months ago

"Senate President Susan Wagle, R-Wichita, and House Speaker Ray Merrick, R-Stilwell, said the reductions in income tax rates would drive economic growth."

This is such a dumb thing to say unless there is extremely hard evidence of which Supply Side Economics has never produced in the past 34 years.

Zillions of USA jobs and thousands upon thousands of USA industries are still elsewhere in the world enjoying USA tax breaks. Which means USA economic growth is still in other countries.

Richard Heckler 4 years, 11 months ago

On one side were economists and politicians who wanted to increase government spending to offset weakness in the private sector. This "stimulus" spending, economists like Paul Krugman argued, would help reduce unemployment and prop up economic growth until the private sector healed itself and began to spend again.

On the other side were economists and politicians who wanted to cut spending to reduce deficits and "restore confidence." Government stimulus, these folks argued, would only increase debt loads, which were already alarmingly high. If governments did not cut spending, countries would soon cross a deadly debt-to-GDP threshold, after which economic growth would be permanently impaired.

---- The argument is over. Paul Krugman has won. The only question now is whether the folks who have been arguing that we have no choice but to cut government spending while the economy is still weak will be big enough to admit that. -----

tomatogrower 4 years, 11 months ago

Infrastructure of one. But the Republicans don't want to take care of what their predecessors built.

oldexbeat 4 years, 11 months ago

Brownbackistan -- love Koch or leave it -- yup, like that....

Bob_Keeshan 4 years, 11 months ago

Do not forget -- last year's tax shift bill also raised taxes on low and middle income Kansans.

In the past two years, Brownback and the GOP have raised taxes by hundreds of millions of dollars in order to cut taxes solely for high-income Kansans.

Yes, it is a tax cut, but only for 10-20% of Kansans. For everybody else, it is an immediate tax increase and a guarantee of future tax increases.

Brock Masters 4 years, 11 months ago

I support getting rid of the mortgage deduction. Streamlining the tax code and removing loopholes is a good thing. However, I am not in favor of raising taxes. Removing a tax deduction without an equal and corresponding reduction in the tax rate is a tax increase.

This is what the legislature did with this tax plan. It is a tax increase and will hurt the poor the most.

chootspa 4 years, 11 months ago

First off - you still get the federal deduction. This is just the state deduction, which in most cases isn't all that big, anyway. Personally, I'd get rid of the deduction entirely. I know it's popular and viewed as a middle income benefit, but the truth is that it disproportionately rewards the wealthy and encourages overconsumption in house purchases.

That said, this year's cut was nothing but shifting the taxes to the middle class and the poor. Badly played, Kansas.

chootspa 4 years, 11 months ago

Yes. More of us should be renters if the interest deduction is the only thing that enables you to buy a home. That means you lose your job, you lose your home. That's a recipe for another financial collapse. Not that it's really that simple. This is a deduction for the rich.

Firstly, most middle class people don't even qualify for the deduction. They just think they do, but you have to itemize before you qualify, and only one third of tax filers itemize. Of those, most are upper income. The bulk of the deduction goes to the 80th and above income quintiles.

Secondly, if you still have enough interest after five years of repayment to still qualify for a mortgage deduction, you probably overbought.

Thirdly, this applies only to the state portion of that deduction. The state. Exactly how much did you earn last year to make the state portion of your deduction buy anything more than a pizza?

chootspa 4 years, 11 months ago

You can usually downgrade your rental space a lot more easily and a lot more quickly than you can a home you own, actually. I've rented and owned over the years, and getting a job offer in another state is a lot easier for renters, let me tell you.

But easy, hoss. No need to get melty. This isn't a personal attack, and I'm not personally accusing you of overspending on your house. I'm telling you what financial experts and economists have been saying for a while. The mortgage deduction primarily benefits the rich, not the middle class. If it were a middle class benefit, it would only count for one home, and there would be a cap on the amount you could deduct to prevent everyone from deducting their McMansion.

It's an extra expense, to be sure, and it's another middle finger from the legislators who think that the ultra wealthy ought to pay nothing at all in income taxes while closing deductions for everyone else. But if it were a debate about just the mortgage deduction, I'd end it.

Brock Masters 4 years, 11 months ago

Stain - I am consistent in my principles. The government should not subsidize the energy industry, the farm industry or corporations.

The mortgage deduction is a subsidy in that as you said, it manipulates the marketplace creating a larger customer base for the real estate and banking industries.

The deduction is not that large so the loss of it shouldn't cause anyone to lose their home.

JuanValdez 4 years, 11 months ago

Brownback and the republican legislature are going to succeed in driving KU out of the AAU.

skull 4 years, 11 months ago

You don't think anyone has been laid off at KU in the last decade? I was laid off in 2001 because of state budget cuts.

elliottaw 4 years, 11 months ago

They are about to lay off 38 faculty in Lawrence alone, and who knows how many staff will be gone.

myavaka 4 years, 11 months ago

You might want to look up the facts about the IRS scandle, it wasn't just conservative groups that were targeted. And historically this isn't the first time groups have been targeted.

deec 4 years, 11 months ago

It appears they didn't fiddle with the charitable deduction. Apparently all those good religious folks will stop supporting their houses of worship if they can't get a kickback from the government in return.

tir 4 years, 11 months ago

Some of those working and middle class conservatives who voted for Brownwhack and these conservative legislators are probably kicking themselves right now, because they are going to be paying for that mistake big time, through higher taxes. Meanwhile the Kochs are laughing all the way to the bank.

just_another_bozo_on_this_bus 4 years, 11 months ago

If there is any economic growth over the next few years, there will be absolutely no way to know to what degree it can be attributed to a reduction in the income tax on the wealthy and the businesses they own (and let's face it, that's all this is so far.)

Pretty much all such economic growth will be the result of economic conditions that have nothing to do with Kansas income tax rates, simply because economic conditions in a state of 3 million people are driven much more by what happens in a world of 7 billion than any relatively trivial tinkering with methods of taxation can achieve.

But the quality of life within the borders of Kansas is most definitely affected by the way tax monies are collected and then spent. And the actions of this legislature and this governor mean that taxes on the poor and the middle class will go up significantly, while the quality of services to those same people will go down equally significantly.

But the wealthiest among us will be just a little more wealthy, and I'm sure some of them will be glad to cut Brownback, et al, in on a little bit of that additional lucre.

Thinking_Out_Loud 4 years, 11 months ago

An alternative explanation: perhaps your ideas about libs were wrong. I wonder what other ideas about them you have had that were wrong.

tomatogrower 4 years, 11 months ago

Actually, I want the sales tax to stay the same, eliminate the food sales tax altogether, and repeal the stupid tax cuts from last year.

Patricia Davis 4 years, 11 months ago

And we all have to wake up and decide to unite against Brownback & Koch.

yourworstnightmare 4 years, 11 months ago

A $777 million increase in revenue is a tax increase, despite the desire of some in the GOP to call it a tax cut. Black is white. Up is down.

The fact is, lower and middle income people will see more of their income go to taxes, and wealthy and businesses will see less. This was how it was designed and was the point of Brownback tax bills of the last two years.

This is a shift of the tax burden, away from the wealthy and businesses and onto the lower and middle income groups. This was by design.

Brownback and the GOP rationalized this by suggesting it would stimulate the economy and produce jobs. I am highly skeptical. We shall see.

tomatogrower 4 years, 11 months ago

And any community that cares about infrastructure and education will have to raise more money on top of that. Which means small school districts in areas with little tax base are going to suffer. What a way to get people to move to western Kansas. Wasn't that one of his phony goals to get people to vote for him? And isn't KU going to have to end the medical training program that was training doctors to work in the rural areas. Of course, he is going to let big agriculture businesses come in and build anything they want without community input, so there will be so many feedlots and chicken mills polluting the water, no one would want to live there anyway, except the undocumented workers these companies hire.

just_another_bozo_on_this_bus 4 years, 11 months ago

Since the wealthy will soon be relieved of any obligation to pay income taxes of any sort, the mortgage interest deduction is moot for them, anyway, isn't it?

Which means that eliminating it is a tax increase only on those who must still pay income taxes, and that's not the wealthy.

voevoda 4 years, 11 months ago

Actually, LarryNative, it's the middle class--especially the lower middle class--that most needs the mortgage interest deduction. For them, it makes home ownership financial feasible, reducing the cost as they build equity in the home.

The rich can afford to own a home free and clear of a mortgage.

chootspa 4 years, 11 months ago

They may be the ones who need it, but they're not generally the ones who qualify for it. It disproportionately goes to the wealthy.

chootspa 4 years, 11 months ago

The thing about statistics is that they apply to groups, not individuals. I'm telling you, whether you believe it or not, that the people who benefit the most from this deduction are the rich.

Kate Rogge 4 years, 11 months ago

From today's Wichita Eagle: Joseph A. Aistrup: Kansas pursuing wrong tax policy

"We are attempting to implement a solution – elimination of income taxes – that has no chance of producing its advertised effect, producing jobs, population growth and tax revenue beyond what we would have experienced without it."

Patricia Davis 4 years, 11 months ago

It will take decades for Kansas to recover from this insanity. Yes, I agree there are many efficiencies we should undertake. My priority would be reducing the number of Kansas counties by half. We have more counties than freakin' California.

The carve out on managed care for those with disabilities will be a nightmare of incompetence and people being underserved or even dying.

I think that people will very soon get their eyeballs pried open when the property tax in Kansas goes crazy.

deskboy04 4 years, 11 months ago

The bad part is they aren't done yet! Just for this year. Who knows what they are capable of next session?

kateomoore 4 years, 11 months ago

whether one calls this a tax increase or a tax cut---what it clearly is, is a shifting of the tax burden from the more affluent to the less affluent. This governor and this legislature do not care about anything that serves the vulnerable, the working class, safety nets, infrastructure, or education. It cares about dictating social agendas and pandering to the Koch brothers et al. The parties have proven themselves. Look at the voting record and vote accordingly. Do not expect help or concern from right wing legislators. They are looking for a cheap labor force and cannon fodder.

DScully 4 years, 11 months ago

The SoB would like nothing better than too see the poor pay more taxes to support the rich. I am poor, and will be poorer still living in this hell hole called Kansas. I feel ashamed to have friends who voted for this douche' bag.

kernal 4 years, 11 months ago

Have patience; after all is said and done, the legislators who wrote and supported these bills will go down in Kansas history among the most ignorant and deluded we've ever elected.

Things will really get interesting once their constituents realize they've been screwed by the flim flam tea party.

SpeedRacer 4 years, 11 months ago

I've said it before and I'll say it again, there is no such thing as a temporary sales tax; they always become permanent. That includes the "temporary" hikes Lawrence voters have passed.

nocrybabies 4 years, 11 months ago

I feel sorry for the people who are stuck here and cannot afford to leave Sasnak.

Charles L. Bloss, Jr. 4 years, 11 months ago

Funding for the KU medical school should not be cut under any circumstances. We need more doctors, not less. I feel the same about nursing and pharmacy schools. With Obamacare we need more of these healthcare professionals.

Larry_Local 4 years, 11 months ago

The only thing the legislature and Brownback accomplished this year is to give everyone - republican or democrat - a reason to vote Brownback out of office next year. Regardless of political affiliation, I'll be happy if anyone is elected as long as its not him! And if he thinks what he's doing to this state will benefit his presidential future, he is sadly mistaken...

puddleglum 4 years, 11 months ago

I don't understand all the complaining. I'm really rich so I don't really care if everybody else has to pay more taxes. who really needs education anyway? I mean lets face it; without education You will be more likely to end up working for min wage at one of my factories. And since none of you can exist without me supplying you your job, its only fair that I shouldn't have to pay taxes. Besides, gas is kinda expensive these days, and I need to fill up the boat. So if you all would kindly stop trying to take what I've rightfully stolen, I would appreciate it.

i_read_things 4 years, 11 months ago

On motion of Rep. Carlson, the conference committee report on HB 2059 was adopted.
On roll call, the vote was: Yeas 69; Nays 45; Present but not voting: 0; Absent or not voting: 11.
Yeas: Alford, Bideau, Boldra, Bradford, Brunk, Couture-Lovelady, Campbell, Carlson, Carpenter, Cassidy, Claeys, Concannon, Crum, Dierks, Doll, Dove, Edwards, Ewy, Gandhi, Garber, Goico, Gonzalez, Hawkins, Hedke, Hermanson, Highland, Hill, Hineman, Hoffman, Houser, Howell, Huebert, Hutton, Jennings, Johnson, Jones, Kelley, Kelly, Kinzer, Kleeb, Lunn, Macheers, Mast, Meigs, Merrick, O'Brien, Petty, Phillips, Proehl, Read, Rothlisberg, Rubin, Ryckman Jr., Ryckman Sr., Schroeder, Schwab, Schwartz, Seiwert, Shultz, Siegfreid, Sloan, Suellentrop, Sutton, Swanson, Thimesch, Todd, Vickrey, Waymaster, Weber.
Nays: Alcala, Ballard, Becker, Bollier, Bruchman, Burroughs, Carlin, Christmann, Clayton, Corbet, Davis, DeGraaf, Dillmore, Edmonds, Esau, Finch, Finney, Grant, Grosserode, Henry, Hibbard, Hildabrand, Kuether, Lusk, McPherson, Meier, Menghini, Moxley, Pauls, Peck, Perry, Powell, Rhoades, Rooker, Ruiz, Sawyer, Sloop, Tietze, Trimmer, Victors, Ward, Weigel, Whipple, Wilson, Winn.
Present but not voting: None.
Absent or not voting: Barker, Bridges, Frownfelter, Henderson, Houston, Kahrs, Lane, Montgomery, Osterman, Peterson, Wolfe Moore.

i_read_things 4 years, 11 months ago

Senator Tyson moved the Senate adopt the Conference Committee Report on HB 2059. On roll call, the vote was: Yeas 24; Nays 13; Present and Passing 0; Absent or Not Voting 3. Yeas: Abrams, Apple, Arpke, Bowers, Bruce, Denning, Fitzgerald, Kerschen, King, Knox, LaTurner, Longbine, Love, Lynn, Masterson, Melcher, O'Donnell, Olson, Petersen, Pilcher-Cook, Powell, Smith, Tyson, Wagle. Nays: Faust-Goudeau, Francisco, Haley, Hawk, Hensley, Holland, Kelly, McGinn, Ostmeyer, Pettey, Pyle, V. Schmidt, Wolf. Absent or Not Voting: Donovan, Emler, Holmes. The Conference Committee Report was adopted.

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