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Interim legislative committees preparing final reports, recommended legislation for 2018 session

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After a lull over the Thanksgiving holiday, several interim legislative committees will meet over the next two weeks, with some of them preparing final reports and recommended legislation for the 2018 session that begins Jan. 8.

In an effort to keep tight reins on the Legislature's own spending, Republican leaders didn't authorize many interim committee days this year. But the ones they did approve have a lot on their plate.

First up Monday is the Joint Committee on Pensions, Investments and Benefits, the committee that has general oversight of the state pension system. In 2015, lawmakers authorized issuing $1 billion in pension obligation bonds to shore up the troubled retirement fund. Since then, however, the state has also delayed regular scheduled payments into the fund. Executive Director Alan Conroy is scheduled to give a report detailing the fund's current value and the current size of its long-term unfunded liability.

On Wednesday, the KanCare Oversight committee holds its final interim meeting and will approve its final report to the Legislature. "KanCare" is the name of the state's privatized Medicaid program. Federal officials only recently gave Kansas permission to continue that program for another year after initially denying a renewal because of concerns that the program was being mismanaged.

In the meantime, the Gov. Sam Brownback-Lt. Gov. Jeff Colyer administration is preparing to launch "KanCare 2.0" in 2019, an expansion of the program that enables Medicaid workers to help line up recipients with other kinds of social and educational services, in addition to health care, but which would also impose a work requirement for some recipients.

On Thursday, the Joint Committee on State Building Construction will take a bus tour around Topeka, visiting state agency buildings, including many agencies that the Brownback administration has moved out of the now-all-but-vacant Docking State Office Building into rented office space under long-term leases.

The following week, on Dec. 4, the 2017 Special Committee on a Comprehensive Response to the School Finance Decision holds its first meeting, which will focus on reviewing the Kansas Supreme Court's Oct. 2 decision in Gannon v. Kansas, striking down the school funding formula lawmakers approved last session, calling it both inadequate and inequitable.

The Special Committee on Commerce holds two days of meetings Dec. 5-6, with most of the attention focused on Sales Tax and Revenue, or STAR bonds. Those are bonds issued to pay for certain development costs for retail or entertainment districts. The bonds are repaid using the increased sales tax revenue that the new development generates. They were first used in Kansas to develop the area around the Kansas Speedway and the Legends shopping district in Wyandotte County.

Kansas lawmakers this year passed a three-year reauthorization of a law that allows cities and counties to set up STAR bond districts — that is, areas for which they can issue STAR bonds to finance redevelopment of areas that are expected to produce new sales tax revenues — but they also imposed a one-year moratorium on establishing any new districts.

The committee will also get a briefing on the history of sales tax revenues in Kansas, a source of revenue that has been growing in recent months after several months of disappointingly flat growth.

Finally, the Special Committee on Assessment and Taxation will hold two days of meetings Dec. 7-8. The most significant of those will be Dec. 8, when the panel discusses the potential impact of changing the way agricultural land is valued.

In 1986, Kansas voters passed a constitutional amendment changing the way property is valued for tax purposes. While residential and commercial property is measured by "fair market value," agricultural land is valued by its "use value," or the economic production coming off of the land.

Farm groups and rural communities insisted on that language at the time, arguing that taxing farm land at its market value could be financially devastating to farmers, especially during down times in the ag industry.

In recent years, though, as the number of farms has declined and the population of Kansas has shifted largely to urban and suburban areas, there has been less and less sympathy for the "use value" assessment system, which many say amounts to a multibillion dollar tax break for the ag industry.

Many officials say the chances of that happening in the near future are extremely slim. It is widely expected, though, that when new legislative district lines are drawn in 2022, following the 2020 census, the balance of power in the House and Senate will shift even further to urban and suburban areas, and at that point, some say, "use value" property taxes for agricultural land may become politically unsustainable.

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