An election bill and the first tax bill of the session are awaiting Kansas lawmakers as they head into the second week of the session starting Tuesday, with most lawmakers coming off of a four-day weekend.
Friday was a "pro forma" day, meaning only a handful of lawmakers in each chamber show up to gavel in, read the introduction of a few bills, and gavel out, ensuring that it counts as a legislative business day, and that they all get their daily salary and allowance. Lawmakers are off Monday for the Martin Luther King, Jr., holiday.
The Senate Ethics, Elections and Local Government Committee will get to work at 9:30 a.m. Tuesday on the elections bill that the House passed on Wednesday. That's the one that cleans up the outdated statute on special elections to fill vacancies in U.S. House seats. Lawmakers are rushing to get that bill to Gov. Sam Brownback to sign before Rep. Mike Pompeo of Wichita is confirmed as CIA director.
Probably the most exciting hearing next week, however, will be in the House Taxation Committee at 3:30 p.m. Thursday. It will hold a hearing on House Bill 2023, which would repeal the so-called LLC loophole that allows the owners of more than 330,000 farms and small businesses to pay no state taxes at all on the income they derive from those operations.
The bill would repeal that provision, and make the repeal retroactive to Jan. 1, 2017. It also repeals several other minor provisions of the 2012 tax bill dealing with adjustments that the state makes to federal adjusted gross incomes when people use that figure to file their state income taxes.
That law is thought to be the most unpopular part of the tax cuts that Gov. Sam Brownback and conservatives in the Legislature pushed through in 2012, and many of the new legislators who won election in 2016 campaigned specifically on a promise to repeal it.
By itself, though, repealing the LLC loophole would only generate about $250 million a year, give or take. The official "fiscal note" on the bill hadn't been published at the time of this writing. The biggest part of the 2012 tax cuts — the part that resulted in the largest drop in income tax revenue — was eliminating the top tax bracket for the wealthiest filers and reducing individual rates across the board on the remaining two brackets.
There are members on both sides of the aisle, and in both chambers of the Legislature, who would prefer to see a more comprehensive tax package that would actually put the state back on the road to long-term financial stability, and they fear that passing a stand-alone bill on the LLC exemption will make it tougher to pass any other tax legislation this year.
The traditional practice on tax bills is to bundle several things together so there's something in the bill for everybody to dislike, but also one or two things that different constituencies want. But that's usually only successful if there's a governor who is willing to hold his or her nose and swallow a few things, and Brownback hasn't given much indication that he's willing to cave on any part of his tax plan.
That means the only alternative is to put together a broad-based tax package that can get two-thirds majorities in both chambers to override an almost certain governor's veto. That's a monumental task on almost any topic, but none more so than tax increases.
Other committees are still in their early stages of the process, getting briefings on various issues and meeting with the cabinet secretaries in charge of each committee's policy area, mainly for the benefit of new legislators who are unfamiliar with all the details of issues that their committees deal with.
The House Appropriations Committee will get a briefing at 9 a.m. Wednesday on the unclaimed property portfolio. Currently, the state puts a portion of its idle funds, equal to the amount it holds in unclaimed property, into a special investment fund managed by the Kansas Public Employees Retirement System where those assets can earn interest.
Brownback has proposed liquidating those assets and cashing in the estimated $45 million in accrued earnings.
On Thursday, the same panel will hear presentations on the KPERS fund and Children's Initiatives Fund. Brownback has proposed freezing the state's contribution into KPERS at 2016 levels for the next two years and writing off the nearly $93 million payment that the state delayed making last year and was supposed to repay this year.
He has also proposed selling off the state's interest in future tobacco settlement payments, the sole source of funding for the Children's Initiatives Fund, and putting CIF-funded programs into the state general fund.
The K-12 Education Budget Committee, which will be in charge of writing a new school finance formula on the House side, will hear presentations at 1:30 p.m. Wednesday from Dale Dennis, a deputy education commissioner and expert on school finance issues, as well as Madeleine Burkindine, director of the Schools for the Deaf and Blind.
On the Senate side, the Transportation Committee will hold a hearing at 8:30 a.m. Tuesday on Senate Bill 5, which would enable certain people whose driver's licenses are suspended for failure to pay a traffic fine to apply for a restricted drivers license.
The Senate Federal and State Affairs Committee will hear from the Attorney General's office Wednesday on the status of a lawsuit pending at the Kansas Supreme Court challenging an abortion law. It will also be briefed on the state's concealed-carry law, including provisions set to take effect July 1 requiring most municipal buildings, as well as college and university campuses, to allow people to carry concealed weapons unless they provide adequate security to ensure nobody can bring weapons into the same places.
The Senate Utilities Committee will hear a presentation at 1:30 p.m. Wednesday from the Kansas Independent Oil and Gas Association on the status of the oil and gas industry in Kansas. The Brownback administration asserts that low commodity prices in the oil and gas industry are largely responsible for the sluggish economic growth and lower-than-expected tax revenues in Kansas for the last few years.
The above list is a partial schedule of events, as published in the House and Senate calendars on Friday. All schedules and topics are subject to change.
Sitting in the Senate Republican caucus meeting Wednesday as elected lawmakers openly talked about defying the Kansas Supreme Court if it closes schools next month, it was hard for people of a certain age not to think back about Richard Nixon and Watergate.
At the height of that scandal, a federal judge ordered the White House to hand over hundreds of hours of tapes of conversations in the Oval Office that had been secretly recorded. The White House refused and appealed to the U.S. Supreme Court.
The Nixon White House had never been particularly forthcoming with information, and the people there had little apparent respect for the authority of any other branch of government to tell them what they could or could not do, up to and including the secret bombing of Cambodia.
So there was naturally great concern about how Nixon would respond to a Supreme Court order to hand over the tapes — tapes that everyone knew would lead to the search for the proverbial "smoking gun" that would bring Nixon down.
As the political tension reached its zenith, the question being asked in American living rooms throughout the country was, "If the president of the United States doesn't have to obey a court order, why should anyone else?" It challenged the very fundamental American notion that no person is above the law, not even the president.
Ultimately, the only power any court has is the power that the public agrees it has. Its power is based on the shared public acceptance that its rulings, however much one might disagree with them, must be obeyed. Day in and day out, that sentiment generally goes unquestioned in Kansas and across the country.
It was a constitutional crisis in the truest sense of the term. In the end, though, Nixon did turn over the tapes, which did produce the "smoking gun." Whatever support he had left in Congress by that time suddenly evaporated, and before the week was out Nixon had resigned.
Later, during a series of interviews with British TV host David Frost, Nixon gave this bone-chilling assessment about his view of presidential power: "When the president does it, that means it is not illegal."
"By definition?" Frost asked. "Exactly, exactly," Nixon replied.
Frost was asking about the president's power to order covert intelligence operations, both at home and abroad, in the interests of national security. And Nixon's response reflected the kind of expansive view about presidential power that historian Arthur Schlesinger Jr. had described in the title of his 1973 book, "The Imperial Presidency."
Fast-forward to the present and Wednesday’s Senate GOP caucus meeting.
"Eventually, we're going to have to stand up to this court and let them know that we are the Legislature, they are not the Legislature. Capitulating with them is, I think, a poor strategy and would continue to be unsuccessful," said Sen. Jeff Melcher, of Leawood.
"We are the appropriators. We are the policymakers. End of discussion," said Sen. Julia Lynn, of Olathe.
"We're going to listen to a court that can't even follow the law?" asked Sen. Greg Smith, of Overland Park. "They have one job, and one job only, and that is to reason and listen to the evidence and make an opinion. And that's all it is, an opinion. They can't tell us what to do. They can opine, and that's the end of their authority."
In the Nixon era, the fear was that his expansive sense of presidential power could erode the power of the other branches, along with public confidence in them. The president, after all, is a citizen like everyone else. If Nixon could defy the court, why couldn't anybody?
Likewise, if taken to their logical extreme, the comments of those legislators Wednesday might lead one to ask: If the Legislature doesn't have to obey a court order, why should a divorced parent who has been ordered to pay child support? Why should any debtor who has been ordered to repay his creditor?
It seemed that the only thing missing from Wednesday's debate was for someone to stand up and say, "When the Legislature does it, that means it is not illegal."
Burdett Loomis, a Kansas University political science professor and an active Democrat, said it's not unreasonable to think that Kansas is witnessing the emergence of an "Imperial Legislature."
"It does strike me that the Legislature thinks that whatever it does should not be questioned," he said. "And it’s even broader than that. They think they represent the state, so if they want to not enforce federal laws, or reach down to the local level and tell localities what to do, all wisdom resides in the state and the state Legislature."
Loomis, who worked briefly in Democratic Gov. Kathleen Sebelius' administration, said the trend became noticeable after Brownback and his conservative allies swept the 2010 elections in Kansas, wresting control of the Kansas House from the coalition of Democrats and moderate Republicans who had formed an effective governing majority. And it was sealed two years later when conservatives purged the Kansas Senate of most moderate Republicans in the 2012 GOP primaries.
In some ways, Loomis said, what Kansas is seeing now goes beyond what America saw in the Nixon White House.
"I think in the end, it was the legislative branch that came to Nixon and said, you’ve got to go. It was Nixon defying the court in every way," he said. "Here you’ve got both the governor and the Legislature. The governor could have stepped up and demanded the Legislature confront the issues before it. But he was unwilling and they were unwilling."
Brownback so far has not said whether he will call a special session later this month to deal with the school finance issue. And even if he did, it remains unclear whether the Legislature can muster the votes to pass a bill that would satisfy the court.
There was a lot of hall chatter, and more than a few tweets, during the Kansas Legislature's wrap-up session that the House had voted on more than twice as many bills in those final five days as it had in the whole 68-day regular session.
I don't know if that's exactly true, but I have tried to cobble together some figures on the number of bills actually passed by the Legislature and sent to the governor this year, and the results lend some credence to that claim.
By my rough count, sifting through the journals of House and Senate, lawmakers did pass slightly more bills (66) during the wrap-up session than they did in the regular session (62). That's a total of 127 bills for the entire 73-day session (by Senate President Susan Wagle's count), or an average of about 1.7 bills per day.
But what really catches the eye is the number that went through on that final marathon day that started around 12:30 p.m. Sunday and lasted until 3:30 a.m. Monday: 18 bills in that one day, or more than one per hour.
Now, before getting too indignant about that, we should all probably admit that everybody procrastinates. In the news business, there's a saying that if it weren't for the last minute, nothing would ever get done. But many people have asked me why lawmakers always put everything off until the last minute, and the answer is actually fairly complicated. In the Legislature, procrastination isn't just a matter of work habits. It's also about strategy and leverage.
"That’s when the powers that be feel they have the most leverage," said Sen. Tom Holland, D-Baldwin City, who has raised his voice in protest more than once about the slow and odd pace of the Legislature.
Granted, the first few weeks of a session have to be excused because that's the time when eager lawmakers are trying to introduce new bills and, they hope, get them scheduled for committee hearings. That takes time. And even in even-numbered years like this one, when bills are allowed to carry over from the previous session, the House and Senate don't just dive in to those leftover bills because most of them were abandoned the previous year for a reason.
What really drives the legislative calendar, and what makes the end of the session a whirlwind of activity that's nearly impossible to follow, is the fact that every bill in the system can be, and often is, used as a bargaining chip for something else.
That's why the vast majority of action that occurs in the wrap-up session involves conference committee reports in which several bills are bundled together. The practice known as the "gut-and-go" — whereby one bill is stripped of its contents and repackaged with the contents of two, three or sometimes even four other bills — used to be considered rare, and even a bit shady. Today, it has become standard procedure.
And so, even when bills have been through the committee process and are ready to be voted on, they can still be held back to be used as a bargaining chip later when it's time to run conference committee reports. Even seemingly innocuous bills that are noncontroversial can get held back, under the theory that putting them into a package will make passage of less palatable bills a little easier.
Sometimes, though, even that doesn't work. That was the case with the seemingly easy bill to name a bison herd in southeast Kansas after a recently deceased former legislator from that area. It ended up packaged with two bills that a lot of people had problems with: one let private zoos allow children to get up close and personal with dangerous animals like baby tigers and leopards; and another to authorize research into the production of industrial hemp.
Not surprisingly, a lot of senators had qualms about putting children into a tiger's cage. And anything that smacks of legalizing marijuana, or even tilting in that direction, gives most Kansas lawmakers heartburn. But then when somebody changed the effective date of the bison herd-naming bill, angering even the people who most wanted to honor the late legislator, the entire package collapsed from its own weight.
But there was another dynamic this year that bogged the process down even more that has many lawmakers frustrated, and worried for the future if it continues. That was the utter reluctance for the last two years of House Speaker Ray Merrick, R-Stilwell, to allow any bill dealing with certain subjects to be fully debated and subject to amendments on the floor of the House because doing so would open them up to amendments that neither he nor Gov. Brownback wanted to deal with.
Specifically, Merrick has tried to avoid putting bills on the open floor dealing with health care and Medicaid, for fear of a Medicaid expansion bill. The same is true with taxes, for fear of an amendment to repeal all or part of the 2012 tax cuts.
Although the House did vote on, and eventually rejected, a bill to repeal the most controversial of those tax cuts, the total exemption for certain kinds of business income, it's important to note how that bill came out of a conference committee, even though it had never been considered by either chamber before, and it was put into a Senate bill so that, under rules in the Legislature, the House would have to vote first.
Conference committee bills are not subject to amendment on the floor. They are always straight up or down votes.
In fact, of all the House bills that passed the Legislature this year, many, if not most, were actually Senate bills, the result of a gut-and-go maneuver in which the Senate put its bill into the shell of a House bill so that House members would only have the option of voting yes or no on the package as a whole.
Bills are also held back until the final days, not because anyone has designs about the contents of the bill, but because they need the bill number so it can be used as a vehicle to carry something else.
Perhaps the most glaring example of that was the final budget bill itself, Senate Bill 249, which actually began as a bill about purchasing and competitive bidding when it was introduced in February. After it passed the Senate, the House stripped out its contents and inserted a different bill dealing with the authority of state agencies to issue bonds.
The Senate did not go along with that change to its bill, and so it was sent to a conference committee where it became a vehicle for an entirely new bill, the final state budget, a bill that was never the subject of any committee hearings or public testimony — not even on the provision reallocating cuts to state universities — and could not be amended on the floor of either the House or Senate.
As the old saying goes, there are two things most people never want to watch being made: sausages and laws.
Rep. Travis Couture-Lovelady, a leading supporter of a new law that allows people to carry concealed handguns without training or a permit, resigned from the Kansas House over the weekend to accept a job as a lobbyist for the National Rifle Association.
Couture-Lovelady, a two-term Republican from Palco, in central Kansas, was one of the lead proponents in the House this year of S.B. 45, known as the "Constitutional Carry" law, which removed the requirement that people undergo eight hours of training and obtain a permit in order to carry a concealed handgun, as long as they are not prohibited by state or federal law from possessing a firearm.
He was also a sponsor of H.B. 2199, the proposed "Second Amendment Protection Act," which would have excluded guns manufactured and possessed in Kansas from any form of federal gun regulation. That bill became the target of a "gut-and-go" procedure in which its contents were stripped out and replaced with a bill on an entirely different subject.
But the Constitutional Carry bill did become law, and it was immediately lampooned on the late-night comedy TV circuit, including a segment on "The Daily Show," in which host Jon Stewart called it a signal that Kansas had ceased to be a national symbol of normalcy.
Couture-Lovelady confirmed in an email that he will become a multistate lobbyist for the NRA. He said Kansas will be part of his portfolio, but he could not say at the time in which other states he would be lobbying.
The Kansas Senate is expected to take up a tax bill Friday which, if it passes, could bring the 2015 legislative session to a close on its record-setting 113th day. But the bill falls far short of actually balancing the state budget, analysts say.
The House, after working through the night and into the early hours of the morning, finally passed the Senate's tax plan, along with a "trailer" bill that changes some parts of the Senate bill.
That complicated procedure was necessary because Senate Republican leaders have refused to put a second tax bill on the floor.
Combined, the two bills would raise the state sales tax to 6.5 percent and they would slow down scheduled cuts in individual income tax rates. They also include a 50-cent per pack increase in cigarette taxes and a variety of other measures expected to generate $384.4 million in the upcoming fiscal year.
Even with that, House Taxation Committee chairman Marvin Kleeb of Overland Park said, Gov. Sam Brownback would have to cut $30-$50 million out of the budget that passed earlier this month.
But some lawmakers say the cuts will have to be worse than that because they seriously doubt estimates of how much money certain provisions will actually bring in. Among them are:
• A tax amnesty program that would waive interest and penalties for taxpayers who pay up their past-due tax accounts. That's supposed to bring in $30 million next year. But critics say unless the Department of Revenue hires more staff and devotes resources to collecting on those accounts, the amnesty program is likely to fall short.
• A tax on "guaranteed payments" to business partners — a contractual arrangement where partners are guaranteed certain payments regardless of the profit or loss of the business — is expected to bring in $23.7 million. But critics say it would be easy for those businesses to reorganize their structure or change the contracts in order to shield those payments from state taxes.
• And the increase in sales tax, which the bill would make effective July 1, is projected to bring in $164 million. By law, however, retailers are entitled to 30 days notice before sales tax rates can change. And because the session has dragged into the middle of June, Senate tax committee chairman Les Donovan of Wichita said, retailers aren't legally obligated to charge the tax starting July 1, although he believes many will.
Meanwhile, internet and mail order retailers may not be obligated to charge the tax until Oct. 1 because, under a multi-state "streamlined sales tax" agreement, not only do states have to give 30 days notice, they also are only supposed to change tax rates on the first day of a calendar quarter.
The Senate is expected to start debating the second bill at 2 p.m. Friday. If it passes, both the underlying tax bill and the "trailer" bill will go to the governor and lawmakers will adjourn.
But if it fails to pass the Senate — and Donovan says some Senate Republicans will have serious concerns about it — the tax and budget debate will go back to square one.
Republican leaders in the Kansas House offered their "trailer bill" proposal Wednesday afternoon that could pave the way for lawmakers to end the 2015 session. But the process of getting both bills through the House, and then getting the trailer bill through the Senate, could be difficult.
House Taxation Committee chairman Marvin Kleeb, R-Overland Park, outlined the proposal in a conference committee meeting Wednesday afternoon.
The trailer bill would clean up, or completely undo, many of the add-on policies that the Senate put into its tax bill. Specifically, it would:
• Continue the food sales tax credit program in which low-income, elderly and disabled individuals can get an income tax credit equal to a portion of the sales tax they paid on food during the year. The Senate bill called for eliminating that program.
• Establish a commission to review various tax exemptions and credits and make recommendations to the Legislature next year about which ones to keep and which to repeal, a clarify which exemptions are eligible for repeal and which are not. In particular, the commission would not review imposing sales taxes on motor fuels, or items purchased by non-profit hospitals, blood banks or schools.
• Clarify language about a property tax lid on cities and counties, providing a number of exceptions under which those local governments could increase property tax revenue beyond the rate of inflation without having to seek a public vote. One area still hazy in the plan would be instances when property tax revenues grow due to new construction and population growth. Kleeb would only say the bill gives "flexibility" in that area, but did not define that further.
• And modify language in the Senate's bill regarding private school scholarships that pay for low-income students in public schools to transfer to private or parochial schools.
Getting that bill through both chambers could be a difficult task, however. Kleeb outlined the following steps that would need to take place.
First, the House must vote on and pass the Senate's tax plan. If it passes, the House will hang on to that bill - i.e., not send it to the governor - until all the other steps are completed.
Second, the House would vote on the trailer bill. If it fails, the House would vote to reconsider its action on the underlying "mega-bill" and go back to the drawing table to come up with a new plan. But if it passes, the House would send the trailer bill over to the Senate.
If the Senate fails to pass the trailer bill, then again, the House would reconsider its passage of the underlying bill. But if the Senate passes the trailer bill, both would go to Republican Gov. Sam Brownback, who has indicated he would sign them.
Another complicating factor is that many of the items in the trailer bill would repeal or scale back positions that were popular with conservatives in both chambers. So leaders may need to rely on Democrats and moderate Republicans to support the trailer bill.
Rep. Tom Sawyer, D-Wichita, the ranking minority member on the House tax panel, said it is possible that some Democrats could vote for the trailer bill because it improves the underlying bill. But he would give no guaranty until House members see the exact language of the bill.
Sawyer said it is a certainty that no Democrats will vote for the underlying Senate bill.
Republican Gov. Sam Brownback is urging the Kansas House to pass the Senate's tax bill, along with any "trailer" bill that's needed to clean up provisions that many House members find objectionable.
"At this point in time, they just need to get something done, get it across the line, work the bill, and then whatever they have to do, need to do, to clean things up," Brownback told reporters during an impromptu news conference outside the House chamber. "It just needs to happen. Now’s the time."
Republican leaders are said to be working with individual groups of legislators to find out what needs to be in a trailer bill to make the whole package acceptable.
Many House members want to remove portions of the Senate bill that call for imposing a property tax lid on cities and counties, and sunsetting a whole host of sales tax exemptions, property tax exemptions and income tax credits.
But a large number of House members, including Democrats and moderate Republicans, are said to be holding out for putting some kind of income tax — either 1 percent, or possibly 2.7 percent — back onto the business profits of certain types of farm and other business organizations.
Brownback would not say what he would do if a trailer bill included reimposing taxes on business income.
"What they need to do now, in my estimation, they need to just take up the Senate bill and then deal with what they need to in the trailer bill," he said. "That’s the route forward. It’s there, it’s doable. And I would urge all of them, everybody — both parties, all factions — to do that and move forward."
The fate of the $423 million tax bill that the Kansas Senate passed Sunday night was very much in doubt in the House Monday afternoon.
The House postponed debate on the bill until around 6 p.m., giving both party caucuses about four hours to look over the complex package of tax measures and other policy issues.
The package passed by the Senate Sunday night relies mainly on increased sales and cigarette taxes, along with cuts in itemized income tax deductions, to raise the money needed to balance the state's budget. But it also contains a number of other policy measures aimed at attracting conservative legislators to vote for the bill.
Members of both parties in the House complained that the bill itself, which is reportedly more than 600 pages long, still has not been made available, either in print or online. The summary of the bill, known as a "conference committee report," runs 119 pages.
House tax committee chairman Marvin Kleeb, R-Overland Park, said many Republicans mainly object to the additional policy measures added onto the bill, such as imposing a property tax lid on cities and counties, and putting a sunset on a wide range of tax exemptions and credits. But he said there are also Republicans who object to the fact that it does not include an income tax on non-wage business income, something Republican Gov. Sam Brownback has threatened to veto.
Conservative groups such as the Kansas Chamber and Americans for Prosperity have been lobbying behind the scenes, trying to convince conservatives to vote no on what would be the largest tax increase in state history.
Meanwhile, Senate President Susan Wagle, R-Wichita, told reporters Monday that senators are growing impatient because the House has not yet passed any comprehensive tax bill. She said if the Senate's bill fails in the House, then the House needs to show what kind of tax plan it will pass.
And if the House doesn't do that, Wagle left open the possibility that the Senate could adjourn and go home.
Asked if there was a "Plan B" on the table, Wagle said: "Yes. Allotments."
That's a process whereby the governor could simply order cuts in the budget to make it balance with projected revenues. The current gap between approved spending and projected revenues is currently estimated at about $360 million.
The budget gap had been at about $406 million, but lawmakers over the weekend approved a $47.8 million tax on certain kinds of health insurance policies, which will be used to draw down increased federal Medicaid reimbursements.
Property tax lid re-emerges in third tax proposal
Kansas lawmakers plan to vote sometime after midnight Friday on a budget-balancing bill that would include a kind of property tax lid for city and county governments.
That idea, which emerged as a surprise in the Senate earlier in the week, would require cities and counties to hold a public vote before they could increase property tax collections above the rate of inflation from one year to the next. That would apply even if the increased revenue is attributable to growth and new construction.
The House, however, has been leery of the idea. So under the latest plan, it would not take effect until Jan. 1, 2018.
The latest negotiated deal also includes higher sales taxes, but no new taxes on non-wage business income. It also would freeze current income tax rates in place for all other tax filers until 2020 while repealing many itemized deductions.
House and Senate negotiators agreed around 8 p.m. to run that plan, starting this time with the Senate.
The previous two tax plans started in the House, and both were defeated by overwhelming margins.
Lawmakers have until Saturday night to come up with a plan to balance the budget. If not, thousands of state employees will be furloughed starting Sunday.
House defeats second tax bill
The Kansas House just voted down the second budget-balancing bill in as many days. The vote shortly before 5 p.m. brought the state to within 31 hours of having to furlough thousands of state employees.
The bill was defeated on a vote of 27-82. Lawrence Democratic Reps. Barbara Ballard, Boog Highberger and John Wilson all voted no. Republican Tom Sloan of Lawrence was absent.
A few Democrats had initially indicated they might vote for it because it contained provisions they had advocated throughout the session: reimposing some income tax on non-wage pass through income of business owners; and a lower sales tax on food purchases. But it also called for raising the state sales tax by three-tenths of a cent, to 6.45 percent.
In the end, Rep. Tom Sawyer, D-Wichita, the ranking Democrat on the House tax committee, said the bill was a step in the right direction, but "it doesn't go far enough."
Republicans were sharply divided on the bill because it appeared to reverse course on the tax policy they adopted in 2012 that eliminated taxes for more than 330,000 business owners and called for phasing out all income taxes over several years.
House and Senate tax negotiators are scheduled to meet again at 6 p.m. to come up with another plan.
Some lawmakers are hoping to work through the night, if necessary, to come up with a plan to avoid furloughs. The House implemented a new rule this year that says it cannot meet after midnight, but the House voted to suspend that rule for tonight.
Second tax plan aimed at drawing Democrats and moderate Republicans
House and Senate tax negotiators offered up another tax plan aimed at balancing the state's budget and avoiding furloughs, and it's one clearly aimed at attracting votes from Democrats and moderate Republicans.
The conference committee met around 11 a.m., shortly before thousands of state employees received notices that they will be furloughed without pay starting Sunday unless lawmakers can pass a balanced budget before then.
The bill would impose income taxes, albeit at the lowest rate of 2.7 percent, on non-wage, pass-through business income for more than 330,000 business owners in Kansas. And it would repeal the formula known as the "march to zero" that is intended to phase out all income taxes over the next several years.
It would also raise the state sales tax rate to 6.45 percent, an increase of three tenths of a cent, effective July 1. But it would lower the sales tax rate on food to 5.7 percent starting Jan. 1. Sen. Marci Francisco, D-Lawrence, put that amendment onto the original Senate bill, and it drew strong bipartisan support on two recorded votes.
The bill has a number of other lesser provisions such as removing the sunset on the "Rural Opportunity Zone," or ROZ, program that allows either a five-year income tax waiver or $15,000 of student loan repayment for people who move into any of the 77 rural counties that have suffered severe population loss in recent years.
It also has a 50-cent-per-pack increase in cigarette taxes, which many public health advocates support. But it would not, as the Senate had hoped, impose any new tax on e-cigarettes, based on the belief, not yet backed by data, that e-cigarettes are less hazardous to a person's health than regular cigarettes.
Both Democrats on the conference committee, Sen. Tom Holland of Baldwin City and Rep. Tom Sawyer of Wichita, are still not agreeing to sign the report, which means the House and Senate have to go through another procedural hoop before they can vote on it. But Sawyer called this latest bill, "a step in the right direction."
"We'll take it back to our caucus and discuss it," Sawyer said. "It's not what we want maybe at this point in time, but at least it's heading the right way."
The House will vote first on the bill, probably sometime after 2 p.m.
Websites poke fun at legislative stalemate
As the Kansas Legislature goes into Day 106 of its regular 90-day session, and the threat of furloughs for tens of thousands of state employees looms less than 48 hours away, web denizens in Kansas haven't lost their sense of humor.
One website popped up this week that probably offers the most accurate, concise and understandable summary of the current status of the stalemate. The name of the site says it all: www.DoesKansasHaveABudgetYet.com. Check it out for yourself.
Another site, with a bit more partisan edge to it, asks readers to nominate candidates for its mock "Stupid Tuesday Primary" in August.
An email to news media outlets promoting the site, ItsTimeToFixStupidKS.com, came from R. J. Dickens, who formerly served on the Kansas Democratic State Committee and was the party's nominee for Secretary of State in 1990.
Dickens, who lives in the Wichita area, told the Journal-World the website was started by a group of Facebook friends, most of whom have been involved in Democratic politics in the past. He said the point of the website is to raise money that will fund negative advertising against "incumbent idiots" in the 2016 campaign. The online "Stupid Tuesday Primary," which runs in August, will identify the targets of that advertising.
So far, all of the candidates nominated have been Republicans, but Dickens said his group isn't necessarily limiting itself. He also said all of the negative advertising will have a humorous tone.
"We can't keep crying about what's happening in Topeka. Let's laugh along with the rest of the world (yes, the whole world is laughing at us)," the website proclaims.
Coverage from Thursday, Day 105
House and Senate tax negotiators reached agreement Thursday on the first — and what many hope will be the last — revenue package to close the state's $400 million budget gap.
The bill will go first to the House, where leaders hope to schedule a vote sometime Thursday evening.
It would raise the state sales tax rate half a cent, to 6.65 percent, while lowering the tax rate on food to 5.9 percent. That's expected to generate $214 million next year.
The bill would not reimpose income taxes on non-wage, pass through income of business owners, something Republican Gov. Sam Brownback had threatened to veto. But it would tax what are called "guaranteed payments" that some business partnerships pay to executives.
Other items include freezing income tax rates for everyone else through 2018, and repealing the formula known as the "march to zero" that was intended to phase out income taxes altogether over the next several years.
The income tax portions of the bill are estimated to generate $145.7 million.
Combined with several other items, the package is estimated to generate $432.1 million next year. It also assumes lawmakers will pass another bill imposing a privilege fee on certain kinds of insurance policies, the revenues for which would be used to draw down more federal Medicaid funding.
Lawmakers are now in the 105th day of the session. They must pass a budget and tax plan before midnight Saturday to avoid furloughing thousands of state workers on Sunday.