Kansas Legislature narrowly passes unbalanced budget, ending 2016 session

photo by: Peter Hancock

House Appropriations Committee Chairman Ron Ryckman, Jr., left, R-Olathe, confers with Taxation Committee Chairman Marvin Kleeb of Overland Park and Rep. Gene Suellentrop of Wichita before a vote late Sunday night on a controversial budget bill.

TOPEKA — Kansas lawmakers worked into the wee hours of the morning Monday to end the 2016 session after passing a $6.3 billion budget for the upcoming fiscal year, a budget that is roughly $22 million out of balance.

That’s because current revenue forecasts show the state will not receive enough tax revenue to pay for all the spending in the bill, and lawmakers did not raise any new revenue to cover the shortfall.

Despite sweeping millions of dollars out of the state highway fund and delaying several major highway projects, and making significant cuts to state funding for higher education, the bill calls on Gov. Sam Brownback to find another $92 million in additional cuts and efficiency savings in order to leave the state with an ending balance of about $70 million.

photo by: Peter Hancock

Democratic Sens. Laura Kelly and Anthony Hensley, both of Topeka, question Republican leaders about a budget bill that they argue is structurally out of balance. The bill barely passed both chambers in the early hours of Monday morning, allowing lawmakers to adjourn the 2016 session.

The bill, SB 249, barely passed both chambers — 63-59 in the House and 22-18 in the Senate — and now goes to Brownback, who has indicated he will sign it. The House voted shortly after 1 a.m. after members agreed to suspend their own rule prohibiting the chamber from meeting after midnight.

In the Senate, the bill appeared to be failing at first, but leaders used a procedural move to hold the roll open for 40 minutes to give themselves time to persuade three Republicans to switch their votes from no to yes. The bill passed around 3:30 a.m.

All members of the area legislative delegation voted against the bill, including Democratic Sens. Marci Francisco and Tom Holland, Democrat Reps. Boog Highberger, Barbara Ballard and John Wilson, and Republican Rep. Tom Sloan.

Sen. Laura Kelly of Topeka, the ranking Democrat on the Senate budget committee, said she believed the Senate shirked its constitutional duty to pass a balanced budget.

“It seems to me this is unprecedented,” Kelly said. “Adjourning with cuts still needing to be made in order to get to zero (ending balance) is unprecedented, as far as I can remember. I think it’s an abdication of our responsibility to put together a truly balanced budget.”

But Sen. Ty Masterson, R-Andover, who chairs the Ways and Means Committee, said the practice is not unprecedented.

“The same scenario happened back under (former Kansas Gov. Mark) Parkinson, and we ended with a lower balance,” he said.

More cuts for KU, K-State

During negotiations between the House and Senate over the weekend, budget negotiators agreed to a new formula for allocating a 3 percent, or $17.7 million, cut for the state’s six universities.

The new plan takes more from larger campuses, including Kansas University and Kansas State University, while reducing cuts to Pittsburg State, Emporia State and Fort Hays State universities.

That change was inserted at the request of Sen. Jake LaTurner, R-Pittsburg, whose district includes Pittsburg State University, according to Senate leaders.

Kelly, who was part of the negotiating team, called it an election-year favor for LaTurner.

LaTurner confirmed that he requested the change, but said it had nothing to do with election politics.

Legislative staff said the revised allocation would increase KU’s budget cut by about $1 million, to more than $5 million both this year and next year. K-State’s cuts would also increase about the same amount, to a little more than $4 million.

KPERS payment

The bill also authorizes the administration to further delay a $92 million payment that was due April 15 to the Kansas Public Employees Retirement System. That payment covers the state’s “employer” share of contributions for K-12 school, community college and technical school employees.

Lawmakers first authorized a delay earlier this year in response to revenue shortfalls. It is currently scheduled to be repaid, with an 8 percent annual interest rate, before Oct. 1.

But the newly revised revenue estimates show the state would not be able to afford that payment and still fund the rest of next year’s budget.

photo by: Peter Hancock

House Appropriations Committee Chairman Ron Ryckman, Jr., left, R-Olathe, confers with Taxation Committee Chairman Marvin Kleeb of Overland Park and Rep. Gene Suellentrop of Wichita before a vote late Sunday night on a controversial budget bill.

The new bill would allow Brownback to continue delaying that payment. But it also earmarks a portion of the state’s future tobacco settlement receipts, plus any excess general fund revenues the state receives, to pay off that obligation over time.

The delayed payment does not affect benefits paid out to retired employees in the affected categories, but it does extend the time it will take to return the KPERS fund to financial stability.

Additional cuts

In addition to the cuts in highway funding and higher education, the budget still assumes that Gov. Sam Brownback will have to make an additional $82 million in cuts to the budget after lawmakers have gone home.

It also assumes the administration can find yet another $10 million in “efficiency savings” from recommendations in the recent Alvarez and Marshal efficiency study.

And if revenues should fall short of projections, which were just revised downward in April, Brownback would be forced to make additional cuts. But the bill would not allow him to cut funding for K-12 education, which accounts for roughly half of all general fund spending.

Nor would he be allowed cut funding for the Department of Education’s Parents as Teachers Program or domestic violence prevention grants.