Lawmakers take Brownback to task over budget comments

In this June 7, 2017 file photo, Kansas Gov. Sam Brownback comments during a news conference about the Legislature's override of his veto of a bill increasing income taxes to fix the state budget, at the Statehouse in Topeka, Kan. (AP Photo/John Hanna, File)

? Top Republicans in the Kansas Legislature pushed back hard Friday against Gov. Sam Brownback and his administration’s vocal criticism in recent days of the budget and tax plan they passed, over his objection.

The exchange took place during a meeting of the State Finance Council, a group chaired by the governor which can make certain financial decisions for the state when the Legislature is not in session.

It occurred on the day before new, higher income tax rates go into effect, the result of a tax plan lawmakers passed over Brownback’s veto in order to fund a budget that Brownback’s staff has criticized for funding “pet projects.”

The meeting was held to authorize the temporary borrowing of idle funds during the upcoming fiscal year in order to manage the state’s cash flow. That’s normally a routine matter that prevents the state from having to delay payments or incur late fees because revenues flow into the state’s general fund at irregular intervals that don’t match up with the times when bills and paychecks are due.

But legislative leaders who serve on the council had been irritated in recent days by comments that Revenue Secretary Sam Williams made in an op-ed article he had submitted to Kansas newspapers, as well as social media comments made by his communications director Melika Willoughby and her assistant Ian Fury.

“The legislature’s budget funds more than $200 million in new spending — that is spending above the increased funding for schools,” Williams wrote in his op-ed. “Despite the legislature’s historic $1.2 billion tax hike, they’ve already spent every dime. Unless cuts and efficiencies are made, the legislature will be looking at more taxes in two years.”

The following day, Fury commented on Twitter that lawmakers, “raised taxes $1.2B so they could spend the money on $200m of pet projects.”

Michael Austin, an economist in the Department of Revenue, tweeted Wednesday, “Expect smaller paychecks next month as new tax increases kick in.”

Moments later, Willoughby reposted that tweet, with the comment: “The #ksleg is coming for your pocketbook with a $1.2 billion tax hike.”

House Speaker Ron Ryckman, R-Olathe, challenged Williams’ claim that lawmakers had “spent every dime,” since budget projections actually show the state will finish the next two-year cycle with a positive ending balance.

He pointed out that about $140 million of that was for payments into the state pension fund that Brownback had proposed not making. And another $20 million of that was to fund pay raises for state employees, many of whom haven’t seen a pay raise since before the start of the Great Recession in 2008.

House Majority Leader Don Hineman, R-Dighton, also fired back directly at Gov. Brownback.

“Governor, as you know I’m a farmer. I’ve been a cattleman, and that means I’ve experienced tough financial times because it’s a cyclical business,” Hineman said. “So I totally understand what it means when someone increases debt and considers liquidating assets. That’s really a sign of desperation. It means your fiscal house is in such disarray that you’re starting to shut down, that you’re grasping at straws, and that was the option you gave to us in January.”

In his op-ed article, Williams also alleged that the tax increases for wage earners that lawmakers passed would be “retroactive to January 1.” But Senate Majority Leader Jim Denning, R-Overland Park, said that was simply not true.

“We went through lots of iterations to make sure that for wage income, the new tax that we passed was effective July 1, 2017, and not retroactive,” Denning said. “His document says that’s not correct, that we actually made it retro. We did not make it retro.”

Under the new tax plan, starting this year, Kansas will return to a three-tiered income tax structure, with rates higher than they are now, but lower than they were before the tax cuts that Brownback championed in 2012.

However, those new rates are phased in over two years, reflecting the fact that the new withholding rates for wage earners will only be in effect for half of 2017.

During the meeting, Brownback, who participated via telephone, defended the budget plan he offered in January, saying it was intended as a way to maintain the tax cuts he championed in 2012, tax cuts he said were just starting to bear fruit.

“The concept in it was to put forth something so that we could maintain a pro-growth income tax policy and bridge to what we thought would be better income times, which I believe we’re starting to see,” he said.

But GOP leaders, including Hineman, said they were not willing to continue hoping for better economic times after so many successive rounds of emergency spending cuts made necessary by recurring revenue shortfalls.

“The Legislature rejected that as too much of a short-term fix that was not sustainable,” Hineman said of Brownback’s budget plan. “It was built on hope that may or may not materialize, and we instead took the approach that we needed to get our fiscal house in order and begin looking for a sustainable solution to the problem of fiscal deficits that we’ve been dealing with for several years.”

Republicans weren’t the only ones criticizing the administration for its comments. Democratic Sen. Laura Kelly of Topeka, who attended the meeting but is not a member of the Finance Council, said she had been offended by comments from Brownback’s communications team.

“I’m really sort of disappointed and surprised that that’s how they would follow up on our legislative action,” Kelly said. “It’s certainly disrespectful, at least, and unbecoming the office of the governor.”