The 2013 session of the Kansas Legislature ended with a whimper early Sunday morning by narrowly passing tax and budget bills that will have a profound impact on the state.
The nature of that impact, however, is the topic of considerable controversy among legislators and the governor, who can’t even agree on whether they raised taxes or lowered them.
Certain impacts, however, are clear, including the hit taken by higher education in the state. The state’s higher education system will see a funding cut of $66 million over the next two years. That includes reductions of $6 million for Kansas University, $8 million for the KU Medical Center and $6 million at Kansas State University.
The tax plan approved early Sunday cancels the drop to a 5.7 percent sales tax and replaces it with a 6.15 percent tax. Although earlier negotiations included a lower sales tax rate on groceries, no such measure was included in the final bill. Income tax rates were lowered somewhat, but those reductions will be offset by lower standard deductions for taxpayers and reductions in key deductions, including one for mortgage interest. The higher sales tax and lower standard deductions both fall disproportionately on lower-income Kansans.
According to legislative researchers, the approved tax plan will generate a net gain of $777 million over the next five years, but that falls far short of making up for the $4.6 billion in lost revenue over the same period resulting from last year’s income tax cuts. Gov. Sam Brownback continues to assert that this year’s measure can’t be construed as anything but a tax reduction for Kansans. He lauded the bills as a “fabulous package” that he said will make Kansas “not only the best in the country to raise a family but also the best to grow a business.”
A number of Kansans would beg to differ. High-quality K-12 education is important not only to families but to businesses seeking to locate in Kansas. Next year’s budget provides flat state funding for those schools with no provision for additional funding if the Kansas Supreme Court rules that the state isn’t meeting its constitutional obligation.
Businesses — especially the high-tech businesses Kansas hopes to attract — also need skilled workers. The huge funding cuts to higher education will make it harder to fill those needs. Cuts to the KU Medical Center will hamper efforts to get the new National Cancer Center off the ground, and cuts at Kansas State may impact its ability to support the new National Bio and Agro-Defense Facility. Wichita’s National Center for Aviation Training, which received $5 million in funding this year, will receive just $3 million next year.
How do these cuts support and promote business development in Kansas?
Brownback and some Republican legislative leaders proudly proclaim that “the nation is watching” what we’re doing here in Kansas.
So are Kansans, and many of them are worried about what they see.