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Archive for Saturday, June 7, 2014

Analyst says her Kansas tax revenue research misrepresented to blame federal government

June 7, 2014

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Topeka — A senior policy analyst in New York says state officials misrepresented her research into unexpected drops in tax revenues in April and May so they could blame the federal government for poor performance and dismiss it as a fluke.

State tax revenues fell $217 million short of projections in May after coming up $92 million short in April, putting state revenue for the fiscal year roughly $310 million below estimates with only one month left, The Wichita Eagle reported.

Gov. Sam Brownback and officials with the Department of Revenue say the shortfalls were caused by federal tax changes and should not continue in the next fiscal year.

Others, including several economists and lawmakers, are afraid the shortfalls will be around awhile.

Lucy Dadayan, a policy analyst with the Rockefeller Institute of Government, told The Eagle the revenue department misrepresented her research about state tax revenue, and that Kansas could be forced to make cuts in the near future.

When they announced the May shortfall, revenue department officials pointed to an April report Dadayan co-authored that said states across the country are having trouble forecasting revenues because of uncertainties with the capital gains tax created by the fiscal cliff.

High-income earners across the country sold stock at the end of 2012 in anticipation of the federal tax on capital gains increasing because of the fiscal cliff. While that boosted income for that tax year and resulted in windfalls for states, many of them now are seeing 2014 revenues falling after the previous year’s inflation.

“Kansas has been affected by this one-time 2013 tax year event. This is evidenced by a 47 percent drop in April and May payments attributed primarily to capital gains,” the Department of Revenue said in its release.

But Dadayan’s report goes far beyond that in casting blame for the plight of Kansas, one of six states to experience a double-digit percentage decline in personal income tax revenue.

“The large declines in Delaware, Kansas, and North Dakota are mostly attributable to the legislative changes that cut income tax rates as well as restructured tax brackets,” the report states.

Dadayan said the capital gains phenomenon had a bigger impact in states like California and New York that rely more on nonwage income.

“Of course the fiscal cliff had an impact in almost every state that has income tax,” she said. “But Kansas is a special case because they had the largest tax cut in their history . and the large tax cuts in income tax is the primary cause of the declining revenues.”

Revenue Secretary Nick Jordan said the department quoted the report “to show that other states were experiencing the same thing.”

“That’s the quote we used, and that’s why we did it,” he said.

Brownback disputed the notion that Kansas’ shortfalls were self-inflicted and insisted they were the product of an ailing national economy.

“We’ll finish this year with several hundred millions of dollars cash on hand . so we’re going to be in fine shape,” he said. “We projected a dip.

We’ve had good overall performance of our agencies being able to hold back costs, so it’s two sides of the equation.”

Comments

Linda and Bill Houghton 3 months, 2 weeks ago

Our state government will do anything it can to shift the blame to someone else. They can do no wrong.

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Elizabeth Newman 3 months, 2 weeks ago

I don't doubt that "we" will end the year with millions of dollars on hand. I don't doubt that "our" agencies are REAL good at holding back costs. I also am certain that 99% of us - "We The People" types - understand what kind of world this Republican agenda is gonna continue to look and feel like. And it's gonna hurt everyone of us even more so, mentally, physically, and spiritually. (The 1% excluded). But it's not just the Republicans. President Obama is strongly behind the Trans Pacific Partnership, which gives COMPLETE control of this Globalization thing to the Corporations who now own our Government. Presently...WE THE PEOPLE...are, as the phrase kinda goes, 'up it with not a paddle in sight '...

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MerriAnnie Smith 3 months, 2 weeks ago

And now President Obama is considering selling our net neutrality to the corporations, too.

Yet the right calls him a liberal. Go figure.

However, when I step back and look at the whole picture, Obama is far far better than the alternatives we've had so far.

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Bob Forer 3 months, 2 weeks ago

Miserable, despicable liars. Oh, and scoundrels as well.

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Larry Sturm 3 months, 2 weeks ago

People on the street know that it is not the national government that is causing the Kansas tax revenue problems it is the tax cuts for the rich to make them richer that is the problem.

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Julius Nolan 3 months, 2 weeks ago

The tax revenue problem was 100% caused by brownie.

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Richard Heckler 3 months, 2 weeks ago

The focus of the USA should be:

--- Removing the ALEC anti American right wing GOP

--- Rein in the CIA,NSA and military spending.

--- Medicare Single Payer which would create an estimated 2.4 million jobs . Spend tax dollars here!

--- Get the massive highway rehab underway. Spend tax dollars here! = jobs

--- Bring on cleaner energy – Cut subsides to dirty coal and Nukes! = jobs

--- Replace the anti american rt wing GOP with the Green Party! = jobs

--- Electing a whole lot of new democrats. = need some new faces!

--- Funding education to the max = new business and new employment. Spend tax dollars here! = jobs

--- Break up the big banks = to prevent more scandals! = saving jobs

--- Put the home loan criminals in jail!!!!!!

--- Allow 50% College Loans To Be Written off Under Bankruptcy = economic growth

--- Leave Social Security Insurance and Medicare Insurance alone. = stability

--- Robin Hood tax.....ABSOLUTELY! http://www.robinhoodtax.org

And don’t forget who killed jobs,retirement plans, medcial insurance and forces homeowners into foreclosure.

--- Why does the GOP Deliberately crash the USA economy? at will? http://www.guardian.co.uk/commentisfree/2012/jun/09/did-republicans-deliberately-crash-us-economy

--- This GOP ENTITLEMENT http://www.dollarsandsense.org/archives/2005/0705rebne.html

--- This GOP ENTITLEMENT - Bailing out The Reagan/Bush Savings and Loan Heist http://rationalrevolution0.tripod.com/war/bush_family_and_the_s.htm

--- This GOP ENTITLEMENT Bailing out the Bush/Cheney Home Loan Wall Street http://www.dollarsandsense.org/archives/2009/0709macewan.html

--- This GOP ENTITLEMENT – Bailing Out Big banks.
http://www.democracynow.org/2009/9/10/good_billions_after_bad_one_year

--- All Free Trade Agreements = exporting USA jobs

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Richard Heckler 3 months, 2 weeks ago

But one example.

My congratulations to workers in 16 states – from Kansas to 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. They're also 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, Missouri, to a KC suburb on the Kansas side, just 10 miles away. What a ripoff! (((AMC Entertainment has since been sold to Dalian Wanda Group of China. )))

When this tax deal was cut AMC and Cordish Co. of Baltimore were partners. As of 5/25/12 this partnership is becoming history.

As with many buyouts/mergers people lose jobs sooner of later due to the expense of purchase. Is all of the above legal as far as the $47 million tax dollar give away is concerned? Where is the $47 million tax dollars?

http://www.jimhightower.com/node/7723#.UkS9vBaTOX0

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Richard Heckler 3 months, 2 weeks ago

"Revenue Secretary Nick Jordan said the department quoted the report “to show that other states were experiencing the same thing.” Nonsense .

When Kansas Public Schools go on the market Kansas will discover one of the shady motives for robbing cookie jars.

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Paul Decelles 3 months, 2 weeks ago

What do you expect from people who think the Earth is 10,000 years old?

6

Ralph Reed 3 months, 2 weeks ago

No it's not Paul. everyone knows the Earth is only about 6000 years old.

2

Lane Signal 3 months, 2 weeks ago

Wait a minute. The Brownback administration distorted some findings and choose misleading pieces of someone's research in order to support there own arguments? I feel so disillusioned. At least Brownie and his crew have determined that, shortly after the fall elections, state revenues will magically shoot up and we will end the year with a surplus. Yeah, that's the ticket.

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Fred Whitehead Jr. 3 months, 2 weeks ago

BROWNBACK!!!! THAT IS THE PROBLEM!!

HE WANTS TO BLAME EVERYONE BUT HIMSELF.....HE WANTS WOMEN PUT IN THEIR PLACE.......HE WANTS TO INFLAME PEOPLE TO ATTACK LAW ENFORCEMENT OFFICERS TO ATTACK THE FEDERAL GOVERNMENT......HE WANTS KANSAS TO BE A SHOOTING GALLERY WHILE ENRICHING THE POCKETS OF THE SECRETARY OF STATE AND HIS GUN FACTORY.

HE WANTS CHAOS SO THAT HE CAN CONTINUE TO BLAME OBAMA.

WHAT PART OF ANY OF THIS DO YOU NOT UNDERSTAND?? WILL YOU VOTE FOR THIS IDIOT AGAIN?????????? Yeah...I thought so.

0

James Page 3 months, 2 weeks ago

Government has always been notoriously bad at making revenue projections. I'm old enough to remember the GAO's projection of the ten yr. cost of Medicare in 1965. The Feds predicted that the ten yr. cost would be 12 billion dollars. The actual cost after 10 yrs. was 112 billion dollars. Our state Gov hasn't been much better over my lifetime when it comes to revenue projections. Remember, "Statistics never lie--but statisticians do."

0

Julius Nolan 3 months, 2 weeks ago

And Republicans are able to lie even more.

1

MerriAnnie Smith 3 months, 2 weeks ago

Let me just make a guess J.P.

In 1965 they projected a 12 billion based on their plans for Medicare at the time. But as soon as they saw its success in helping so many, they found other ways to use it for the good of the country's citizens and added other aspects to Medicare, at which times they would have had a higher projected cost for the first ten years.

When a program works so well for some of the citizens, it stands to reason they'll try to find ways to help more people who need help with that program by expanding it.

No research on that done by me, but it seems logical, knowing what I know about human nature and the propensity, especially on the left, to want to help the needy, the elderly, the disabled, the sick... and so on.

Basically, what we had in administrations during that time was Johnson, then Nixon, and a year of Ford. About evenly split, with a bit more time for the Republicans.

What do you think? Could I be right? Or not?

EDITED: So I had to do a few minute's research online. I found this:

"The Social Security Amendment of 1972 expanded the program to include individuals under age 65 with permanent disabilities and people suffering from End-Stage Renal Disease. In 2001, eligibility expanded further to cover people with Lou Gehrig’s disease."

https://www.seniormarketsales.com/go/sms/articles/articles-about-medicare-solutions/the-past-present-and-future-of-medicare/

At that time, in 1972, no doubt there would have been a change in the estimated cost the first ten years, or something close to that.

And we always want to remember that inflation began around the time they amended it in 1972, with an average inflation

http://www.usinflationcalculator.com/inflation/historical-inflation-rates/

1965 inflation was around 1.5%

After that it started going up and by 1974 it was 11%. A bad year to be sure.

So, it's fair to say that the estimate in 1965 also had the problem of inflation that led to the absolute dollar change from 12 billion to 112 billion not nearly that much of a change. Though big because of all the under-65's who were added later.

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James Page 3 months, 2 weeks ago

While I will agree that Medicare has been beneficial to millions of people, it is in the worst fiscal shape of any of the entitlement programs. I am in favor of helping needy people, but without reform all entitlement programs are doomed to bankruptcy. My point was not to criticize Medicare, but simply point out that Government has a lousy record of predicting revenues and costs over the long term..

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MerriAnnie Smith 3 months, 2 weeks ago

My understanding is that Medicare is not in trouble today at all. And that we have some years to figure out how to KEEP it from falling into trouble. And that the best way to do that is simply raise the maximum income employees have to pay Medicare and Social Security on before maxing out. Presto. Medicare and SS saved in one small adjustment.

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Kevin Elliott 3 months, 1 week ago

I have no doubt Brownback and his brownbackites lied, cheated and stole to justify their point of view.

It is clear what they will think about any subject without even having to hear them. It is because they refuse to use reason, facts or reality to form their opinion, it is a pre destined opinion no matter what. It is dishonest, dishonorable and immoral.

They offer no real values, no real morals, only sides.

They are failures to the public and we are failures for electing the liars.

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