New report likely to give clues about size of possible state tax increase

April 19, 2017

— Kansas lawmakers and other state officials are anxiously awaiting a report Thursday that will show how much tax revenue the state can reasonably expect to receive over the next fiscal year.

The report by the Consensus Revenue Estimating Group will be used by lawmakers when they return May 1 to write a final two-year budget for the state.

More importantly, though, it will also be used to decide how large of a tax increase lawmakers will try to pass in order to pump more money into K-12 public schools while avoiding deep spending cuts in other areas of government.

The last time the group met, in November, it slashed estimates for the current fiscal year by $346 million. That came after a long string of monthly reports that showed revenues were consistently coming in well below the previous estimates.

Since then, however, monthly receipts met or exceeded the estimates every month until March, when they came in $11.6 million short.

Because of that, some officials have said they don't expect Thursday's report to change much from the November report.

In November, the group issued its first estimate for the upcoming fiscal year, which starts July 1, forecasting that the state would take in just over $5.7 billion in tax revenue, or about 1.3 percent more than the current year.

It's also about $583 million less than what the state needs to continue funding operations at their current levels without delaying certain kinds of payments or sweeping money out of other funds as it has done for the last several years, according to the Legislature's nonpartisan Research Department.

That figure also does not include any new funding for public schools that will be needed to respond to a Kansas Supreme Court decision that said current funding is inadequate and unconstitutional.

When lawmakers return, the Kansas House plans to take up a bill quickly that would establish a new funding formula for public schools, adding about $150 million a year in school funding each year for the next five years.

Sen. Tom Holland, of Baldwin City, the ranking Democrat on the Senate tax committee, said Wednesday that he believes the state needs to raise at least $750 million a year in new taxes.

In February, both chambers passed a tax bill that would have raised about $1 billion over the next two years by reversing some of the signature income tax cuts that Gov. Sam Brownback championed in 2012.

Brownback, however, vetoed that bill, and while the House voted to override that veto, the Senate fell three votes short of the required two-thirds majority.

Originally published at: http://www2.ljworld.com/news/2017/apr/19/lawmakers-await-new-revenue-estimates/