Archive for Monday, April 20, 2015

Kansas revenue projections for next year contributing to even bigger budget hole

April 20, 2015, 8:21 a.m. Updated April 20, 2015, 11:10 p.m.

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— State budget officials in Kansas issued a gloomy report Monday that says total revenues flowing into the state are expected to fall 3.5 percent next year, creating an even bigger budget hole for lawmakers to fill when they return next week to wrap up the 2015 session.

The report, known as the Consensus Revenue Estimates, predicts the state will collect only $5.7 billion in revenue in the fiscal year that starts July 1, the smallest amount since the depths of the Great Recession in 2010, when the state collected only $5.2 billion. It’s also $700 million less than the state collected in fiscal year 2012, the last year before Gov. Sam Brownback’s massive income tax cuts took effect.

That projection for fiscal year 2016 is $98.2 million lower than budget officials had previously estimated in November. The projection for the following fiscal year calls for modest growth, to $5.77 billion. But that is still $100.8 million less than the earlier forecast.

Budget director Shawn Sullivan said the downward revision was mainly due to smaller-than-expected growth in “consumption taxes,” including retail sales taxes, as well as a decline in corporate income taxes. Despite that, he said, the Brownback administration has no plans to reverse its tax policy, which calls for shifting the state’s reliance away from income taxes and onto consumption taxes.

“We will work with the Legislature to structurally balance the budget and hopefully continue the trend towards lower income taxes as we move from a tax on productivity to a consumption-based tax,” Sullivan said.

But Senate Democratic Leader Anthony Hensley, of Topeka, said the declining revenues were a direct result of the governor’s tax policies.

“Just as we anticipated it would be, the consensus revenue estimate report is grim, all because of Sam Brownback’s failed economic experiment,” Hensley said in a statement released via email. “These numbers mean that the budget will be unfairly balanced by raising taxes on low and middle income Kansans while protecting wealthy Kansans who benefit from Brownback’s income tax cuts.”

By law, the final budget that lawmakers adopt this session must balance to the newest estimate, including providing for some amount of cash reserve left over at the end of the year.

So far, neither chamber of the Legislature has passed a comprehensive budget bill for the next two years, although they have approved a bill funding K-12 public education, and Republican leaders in the House said they are committed to fully funding that plan.

“We’ve committed to giving schools stable and predictable funding through the block grants, including the additional $126.2 million in new money added to schools for equalization as directed by the courts last spring,” House Speaker Ray Merrick, R-Stilwell, said in a statement.

Meanwhile, House and Senate negotiators have tentatively agreed on a budget plan to fund most of the rest of state government. But based on the new revenue estimates, officials said, that plan would require roughly $400 million to $410 million in additional revenue next year.

Brownback has already proposed about $210 million in new revenue, mainly through increases in alcohol and cigarette taxes. But Republican legislators so far have given that plan a cool reception.

Sullivan said the administration will release its own proposed budget amendments on Thursday, when the House Appropriations Committee is scheduled to meet. And while he would not divulge complete details of that plan, he said part of it will call for a reduction in state Medicaid spending to reflect lower estimated costs in that program.

And despite the gloomy revenue picture, Sullivan said the Kansas economy was showing positive signs, pointing to growth in private-sector jobs, average weekly wages and the state’s relatively low unemployment rate.

Asked how the administration can fund state government effectively with less money than it had available eight years earlier, Sullivan said it was a matter of setting priorities.

“It’s a balancing act between continuing what we believe is job growth, wage numbers, unemployment and funding the core services that are in the budget,” Sullivan said. “So that will need to be weighed as this final budget and revenue package are contemplated.”

Lawmakers are scheduled to return to Topeka on April 29 to finalize the budget and wrap up the 2015 session.


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Comments

Greg Cooper 2 years, 2 months ago

Imagine that: cut taxes, do not create more jobs, and state revenues drop. Who could have guessed?

Andy Anderson 2 years, 2 months ago

Revenue? Get real. This is money stolen from working stiffs and frittered away on greedy government employees.

The less money big government greed takes, the better for the working class.

Greg Cooper 2 years, 2 months ago

And that, Andy, is completely ignoring reality. If you have a reasonable thought as to how our "working class" can get by without government money working for them, then just put it forward. Otherwise, you're mouthing just what you always do: silliness backed up by ignorance or the reality of the American monetary system.

Now, look at your most recent rant. Tell me, Andy, what percentage of government money is spent on government employees. Tell me what is going to be better for the "working class" if government income decreases. Tell me what it takes to make the entire system work when government doesn't have enough money to honor its commitments to its citizens, "working class" or not.

You're so good at negative, but how about a thoughtful, specific layout of how you envision government spending your money (because you're not going to stop them from getting some of it, and that's reality).

And don't be stupidly simplistic. Just tell me what you know will work.

Dorothy Hoyt-Reed 2 years, 2 months ago

Andy will be one of the first to whine when highways start to fall apart.

Brock Masters 2 years, 2 months ago

Andy for a complex thinker you've missed a significant fact - services are being cut and your taxes are going up. The government is taking more from you and giving you less - contemplate the complexities of that scenario.

Bob Forer 2 years, 2 months ago

Fred Mertz!!!!!!!!!!

FTW!!!!!!!!!!!!!

(you okay, Andy boy?...........er, son..... you alright? If you can't talk, just key your mike, son)

Bob Forer 2 years, 2 months ago

Three Alpha Six, if you can't talk, son, just key your handset twice. Over .....

Andy Anderson 2 years, 2 months ago

Thanks for your enlightened, yet slightly nuanced, justification for more greedy government.

btw, of course the greedy will take more and give less.

You are are a shining star for rational thinking. Whether you realize it or not.

Steve King 2 years, 2 months ago

I'm with Andy. Let him drive on only the roads Andy's taxes paid for. Maybe a 1/2 mile of asphalt in his lifetime. Oh, and don't cross any bridges. We paid for them. You can swim across the river.

Phillip Chappuie 2 years, 2 months ago

I seriously do not understand how Sullivan is still blindly parroting the extended bovine fodder being served up. It is clear that the shot of adrenaline really is not going to pan out. For realzees dude, how far must the ship sink before you actually believe you are taking on water?

Leslie Swearingen 2 years, 2 months ago

He won't make it all the way across the Kaw before a mutant catfish gets him. Who knows what lurks in the depths of the river? The Mighty Catfish knows, but he ain't tellin'.

Richard Heckler 2 years, 2 months ago

The answer: reinstate the taxes that were cut without foundation.

New World Order Supply Side Economics has no record of success in 35 years.

Standard & Poor’s downgrades Kansas bond rating BY BRAD COOPERTHE KANSAS CITY STAR 08/06/2014 10:30 AM 08/06/2014 10:30 AM

A second bond rating agency has downgraded Kansas’ standing because of declining revenues following massive income tax cuts signed into law by Gov. Sam Brownback.

Standard & Poor’s on Wednesday morning reduced the state’s credit rating a notch to AA from AA+, citing a structural imbalance between revenues and spending in the state’s budget.

The bond rating agency said the state’s failure to match the income tax cuts with reductions in spending will leave the state with dangerously low reserves.

Analysts projected that the state could burn through its reserves this fiscal year, putting more pressure on lawmakers to cut the budget.

In May, Moody’s Investors Service cited similar concerns when it reduced the state’s bond rating one level because of mounting financial pressure on the Kansas state budget, partly because of the income tax cuts.

But Moody’s warned that cutting spending might not be easy given the court-ordered spending on schools, keeping up with Medicaid demands and funding pensions.

Read more here: http://www.kansascity.com/news/government-politics/article1138180.html#storylink=cpy

Richard Heckler 2 years, 2 months ago

Fire Kansas Republicans

Cut the program that supports the controlling party's pay. Why? Because the economy has not grown significantly in the last decade. This party owes the taxpayers!

How does the controlling new administration know the cuts he is ordering are necessary and will in fact produce the desired results? Taxpayers need hard evidence NOT political nonsense.

Where is the hard evidence? This question is valid because the same party has been in control for the past 25 years yet economic growth has never been significant.

Tax cuts have NOT provided the desired results!!

Kevin Millikan 2 years, 2 months ago

Do you smoke? Do you drink? Are you low income? Guess what? You're about to be hosed.. No complaints people, remember..you voted them in!

BTW.. Washington state.. great jobs, no taxes, great real estate market, people that care and won't stick you with "sin taxes".. oh, and you can ride year round. :)

Andy Anderson 2 years, 2 months ago

lol..you are Complex Millikan. For myself, from birth to HS graduation, Washington was ok. I used to drive by tulip fields for years, there was not a critical thinker to be seen. Then the Complex abandoned central California and like flies on...infested Skagit valley,

You know why they legalized weed don't you? It's not for the tax dollars because black market weed has skyrocketed. It was because of people like yourself.

Kevin Millikan 2 years, 2 months ago

they legalized pot for me? wow, now THAT's complex Anderson. And no, black market weed has not skyrocketed, do a little research. It has actually gone down, along with the decline of use by our teenagers. Understand what you are saying before you open your pie-hole dude. So the economy is so good here because we have no critical thinkers? Make sense to anyone else besides Anderson? LHS class of 1980.

Miko Harper 2 years, 2 months ago

Andy is a troll. He tries to use "Complex Critical Thinking/Thinkers" as a phrase meant to insult others, usually ones he thinks are from the left side of the political spectrum, and it just makes him look more asinine in the process.

Andy Anderson 2 years, 2 months ago

It's obvious there is an element of society that needs greedy, efficient in their own minds, government employees to care for their every need.

Why do I have to pay for you all chaps insecurities?

You all Complex critical thinkers are flooding the country with ultra poor "future Americans". What do you expect from the working stiffs that have to pay for their existence? Work harder?

Richard Crank 2 years, 2 months ago

And we're stuck with this drunk driver at the wheel for three more [choose your word] years.

Brock Masters 2 years, 2 months ago

Budget director Shawn Sullivan said the downward revision was mainly due to smaller-than-expected growth in “consumption taxes,” including retail sales taxes, as well as a decline in corporate income taxes. Despite that, he said, the Brownback administration has no plans to reverse its tax policy, which calls for shifting the state’s reliance away from income taxes and onto consumption taxes.

Andy Anderson 2 years, 2 months ago

I am surprised you are for redistribution of money. You're avatar must be a front for your ulterior motives.

Brock Masters 2 years, 2 months ago

Andy, i am against wealth redistribution which is why I am against the Brownback tax/budget policies.

His experiment eliminated taxes for LLCs while also eliminating some tax deductions and credits for individuals with the promise of eliminating individual income tax to offset the loss of tax deductions and credits.

However, because of decline in revenue he kept the sales tax increase that was set to expire - a tax increase and reneged on lowering our tax rate which means coupled with the loss of tax deductions and credits we pay more in taxes.

Consequently (stay with me because this gets complicated here) he shift the dollars from my pocket and yours into the pockets of LLCs - wealth redistribution which I am against.

Even worse than what he has done to me, he has taken what little the poor had and given it to the rich.

I support lowering taxes but not on the back of the poor. I support eliminating TANF fraud, but I want meaningful action that can be enforced and based in reality - not some mean-spirited do nothing prohibitions on cruise ship spending.

I want safety nets to be there for those who need them and for them to be accessible. I don't want the process to be so difficult that people can't access the help they need and then claim they are receiving aid so they must be working.

No, I am not for redistribution of wealth, but I am also not for stupidity.

Bob Forer 2 years, 2 months ago

"No, I am not for redistribution of wealth, but I am also not for stupidity."

Translation: YOu have some basic human decency, Fred./

Andy Anderson 2 years, 2 months ago

What is it about farming humans that appeals to you?

Tell me what method you use to raise the best of the best. What is the ratio between self responsibility and giving them whatever you think they need to survive results in the most productive human?

Dorothy Hoyt-Reed 2 years, 2 months ago

Why do you want to distribute wealth from the middle class to the rich?

Bob Forer 2 years, 2 months ago

This is an outrage. Those figures have to be wrong. It's a socialist propaganda conspiracy. Obama and his comrades must be behind it. Dear Leader Governor said we were getting a shot of adrenaline. Well, not every patient responds the same. Sometimes the reaction is delayed. Liberty, Justice and Prosperity for all is just around the corner for every Kansan

In closing, may both god and the Flying Spaghetti Monster bless Kansas.

Please, everyone, let us bow our heads in prayer .........................

Greg Cooper 2 years, 2 months ago

" Dear Leader Governor said we were getting a shot of adrenaline. Well, not every patient responds the same. Sometimes the reaction."

Exactly, Bob. A shot of adrenaline can be deadly to people (governments) that do not indicate its need.

Steve King 2 years, 2 months ago

It's only going to get worse. We have seen time and time again how inaccurate their projections are. What's not being emphasised is how much has been used up to plug the holes in the budget.The last two years we have seen every surplus siphoned off to plug the holes. $2 Billion siphoned off the DOT Bank. That's over $2.5 Billion redirected. Now most all surplus is gone. It's only going to get worse.

What is and where is the plan to pay back the DOT? Or do we just watch the bridges crumble? There are Federal funds in that account. How soon before the Feds say no more?

Brock Masters 2 years, 2 months ago

What would be the grounds for recall? I don't think the recall law allows recall on the grounds of poor performance so on what basis would you recall him?

Dorothy Hoyt-Reed 2 years, 2 months ago

Isn't it against Kansas law for the legislature to run a deficit? So, anyone who voted or signed the tax bill, which took us to bankruptcy, broke the law and should be arrested and fired. Sounds like grounds to me.

Dorothy Hoyt-Reed 2 years, 2 months ago

Running a deficit is "failure to perform duties prescribed by law".

Brock Masters 2 years, 2 months ago

Well Dot if you think so then step up and start the process.

Do a little research and you will find out a recall isn't going to happen, but you can try.

Lynn Grant 2 years, 2 months ago

The fourth paragraph pretty much explains the cause of our situation and why it will continue. ."Smaller-than-expected growth in “consumption taxes,” including retail sales taxes, as well as a decline in corporate income tax" will definitely take revenue down. The proposal to raise tobacco and alcohol sales tax will drive buyers to the border where they will purchase those products as well as groceries (since Kansas refuses to consider a lesser food tax), gas and anything else they want or need. Not a good plan to grow consumption revenue. Then there is Brownback's refusal to admit his plan did not give us a shot of adrenalin, but rather blew a hole in our economy. He is much like Nero fiddling while Rome is burning.

Dorothy Hoyt-Reed 2 years, 2 months ago

Exactly. If they weren't so blind, and following their own greedy agenda, they could have looked at the states that relied on consumption taxes when the recession hit. They were in much worse shape than in Kansas where we had several sources of revenue. But they want failure, as long was their bribers, I mean donors, get rich.

Marc Wilborn 2 years, 2 months ago

Are we talking about the state of Kansas or the federal gov't? Brownback is a horrible governor but he appears to have won the position fair and square so its what you get until a better alternative is offered.

As to the federal government, a better Ponzi scheme could not be constructed. There is little or no relationship between taxes paid and benefits under the federal government system.

Marc Wilborn 2 years, 2 months ago

I believe that, if the federal government was a little more efficient at the use of our tax dollars, you wouldn't see many of these issues at the state level. This goes for any party controlling the Whitehouse.

All the democrats have is 'but.. but.. but Bush'.

Dorothy Hoyt-Reed 2 years, 2 months ago

And I don't think anyone but Marc has mentioned Bush.

Dorothy Hoyt-Reed 2 years, 2 months ago

Please never use the interstate highways or bridges then. And I'm sure your parents were rich enough to send you to college and not make loans or get grants. And quit using the internet or get any treatment for disease, since the government paid for the research. And be happy you don't speak German or Japanese, since the mean old federal government defeated the fascists.

Some of the rich benefit a lot from the modern wars we fight. I could do without that, but your buddies want to raise the money we give to the defense industry, so they can appear to be macho he-men. I'm sure you worship the rich, so aren't you happy we give them money to build more over priced bombs, airplanes, tanks, etc? And we allow them to make lots of money drilling on government land for almost no rent, and subsidize their businesses. And you eat cheaper food, because we subsidize farmers.

And next time you fly, let's hope that plane's pilot has good eyes. He doesn't need the air traffic control people to keep him from running into another plane. That darn nanny state! Telling planes where they can or cannot fly.

Fred Whitehead Jr. 2 years, 2 months ago

Well, most of you have said it, we have a stupid, ignorant chief executive that is beholden to the Koch Industries Regime.

Thanks, Governor Koch, for all the GOOD things you bring to Kansas, no job increase, fiscal insanity, and a coven of cronies trying their very best to keep "wrong" people from voting.

Gee, I am proud to live in this screwed up state.!!

Philipp Wannemaker 2 years, 2 months ago

Bet the brownie supporters won't understand your sarcasm.

Philipp Wannemaker 2 years, 2 months ago

This comment was removed by the site staff for violation of the usage agreement.

Brendon Allen 2 years, 2 months ago

Also Marc I am sure you know ks is a net receiver of federal aid. (They pay in less than they get). So if anything people in ny and California should be mad about supporting our welfare state.

Tracy Rogers 2 years, 2 months ago

Will one of Sam's minions please have the balls to tell the idiot that his plan is not working!

Larry Sturm 2 years, 2 months ago

Brownbach's hole is getting getting deeper and deeper, at least Nixon had the guts to resign Brownback does not have the intelligence to do so. Let's pray but not to Brownback's god the Koch brothers.

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