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.
Consumers in Kansas would pay less sales tax on food purchases starting next year, under a tax amendment that Democratic Sen. Marci Francisco of Lawrence added to a bill Tuesday night.
But whether or not that amendment survives during negotiations with the House remains an open question.
Francisco offered her amendment at the end of another lengthy debate over tax policy in the Senate. For the previous three days, Republican leaders in the Senate had tried to cobble together a $400 million-plus tax package to close the projected budget gap for the upcoming fiscal year before the state has to start sending out furlough notices next week to potentially thousands of state employees.
Several times, Republicans offered up amendments that included entire packages of tax proposals, some of which would be more popular than others. Each time, Senate Democratic Leader Anthony Hensley would divide the motion, forcing roll call votes on each individual piece.
As a result, only the popular items passed, including the reduction in food sales tax, and an income tax exemption for about 388,000 low-income tax filers being among them. The other, less popular portions - raising the overall sales tax rate and raising cigarette taxes - all failed.
By Tuesday morning, the Senate had a bill that not only failed to close the budget gap, it actually made the gap wider. So GOP leaders agreed Tuesday to return to their original plan, one they had been forced to abandon last Friday, to strip out the Democrats' amendments and send a shell of a bill to conference committee where a handful of lawmakers could negotiate a package for straight up or down votes in each chamber.
But Democrats objected to that, arguing that Republicans were trying to abandon positions that a majority of senators had gone on record endorsing.
Thus, after stripping out the Democratic amendments of the last two days, Francisco offered a motion to put the reduction in food sales tax back on. Her motion passed on a roll call vote, 24-11.
The measure reduces the food sales tax rate to 5.7 percent, from 6.15 percent.
The Senate is expected to vote on final passage of the bill Wednesday. It will then be sent to the House, which is expected to request a conference committee.
Wednesday will mark the 104th day of the legislative session. Lawmakers have until Sunday, June 7, to pass a balanced budget before furlough notices are sent to non-essential state employees.
TOPEKA — House Minority Leader Paul Davis, D-Lawrence, on Friday gave a farewell speech to the chamber he has been working in for the past 12 years.
"Thank you for the friendships that I will cherish forever, for the memories that will never leave me, and the opportunity to simply serve," Davis said.
Davis is giving up his seat to run for governor against Republican Gov. Sam Brownback.
He told House members that next year he will be working in the governor's office or in his law office in Lawrence.
Davis said it has been an honor to serve the 46th House District. For the past six years, he has also been minority leader.
Davis thanked his wife, Stephanie, daughter, Caroline, and parents, who were all present, and each member of the Douglas County delegation, saying he learned from all of them.
He also thanked his staff and House Republican leaders.
In new ad, group backing Brownback praises governor for school bill but doesn’t mention repeal of teacher tenure
A group backing Gov. Sam Brownback churned out a commercial praising Brownback for the new school finance bill, but the ad doesn't mention controversial parts of the bill, including a repeal of job protections for teachers.
The spot sponsored by Road Map Solutions Inc., led by Brownback's longtime political adviser David Kensinger, was running this weekend and cites the bill approved April 6 in the Legislature.
The measure, approved with only Republican votes, was passed after a Kansas Supreme Court ruling that said the Legislature must increase funding to poor schools. But the bill also includes measures opposed by Democrats and some Republicans that would repeal teacher tenure and provide corporate tax breaks for private school scholarships for low-income children.
Brownback is expected to sign the bill into law.
"We got it done," says the announcer on the new ad. The ad says the bill will provide $73 million more for schools and $78 million in property tax relief.
But the ad doesn't mention those education policy changes that have generated criticism.
House Minority Leader Paul Davis, the likely Democratic challenger to Brownback, said the repeal of teacher tenure represented "a clear attack" on teachers.
A national uproar has ensued over House approval of a bill that would provide legal protection for those who, because of religious beliefs, refuse to provide services to same-sex married couples.
The 72-49 vote on Wednesday that sent House Bill 2453 to the Senate was accompanied by several written explanations by many legislators on why they voted the way they did. Those are recorded in the House Journal.
Below is the roll call vote on HB 2435 and the written explanations of vote and who signed them.
HB 2453, AN ACT concerning religious freedoms with respect to marriage, was considered on final action.
On roll call, the vote was: Yeas 72; Nays 49; Present but not voting: 0; Absent or not voting: 3. Yeas: Anthimides, Boldra, Bradford, Brunk, Couture-Lovelady, Campbell, Carlson, Carpenter, Cassidy, Christmann, Claeys, Corbet, Crum, E. Davis, DeGraaf, Dove, Edmonds, Edwards, Esau, Estes, Ewy, Garber, Goico, Gonzalez, Grosserode, Hawkins, Hedke, Henry, Hibbard, Highland, Hildabrand, Hoffman, Houser, Howell, Huebert, Hutton, Jones, Kahrs, Kelley, Kelly, Kiegerl, Kinzer, Kleeb, Lunn, Macheers, Mast, McPherson, Meier, Meigs, Merrick, Moxley, O'Brien, Osterman, Pauls, Peck, Petty, Powell, Proehl, Read, Rhoades, Rothlisberg, Rubin, Ryckman Jr., Ryckman Sr., Schroeder, Schwab, Schwartz, Seiwert, Suellentrop, Sutton, Thompson, Vickrey.
Nays: Alcala, Alford, Ballard, Barker, Becker, Bollier, Bridges, Burroughs, Carlin, Carmichael, Clayton, Concannon, P. Davis, Dierks, Doll, Finch, Finney, Frownfelter, Gandhi, Henderson, Hill, Hineman, Houston, Jennings, Johnson, Kuether, Lane, Lusk, Lusker, Menghini, Perry, Phillips, Rooker, Ruiz, Sawyer, Sloan, Sloop, Swanson, Tietze, Todd, Trimmer, Victors, Ward, Waymaster, Weigel, Whipple, Wilson, Winn, Wolfe Moore. Present but not voting: None. Absent or not voting: Bruchman, Peterson, Thimesch. The bill passed, as amended.
EXPLANATIONS OF VOTE
Mr. Speaker: It is my deeply held sincere religious belief that the commandment to “Love one another” is contradicted by this legislation. This bill expressly permits discrimination against my neighbor in the name of religious freedom. I vote no on HB 2453. — Sydney Carlin.
Mr. Speaker: I strongly believe in preserving religious liberty. I also believe that between the constitutional amendment passed in 2005 and HB 2203 passed last year, we have accomplished most of the intent expressed in HB 2453. HB 2453 has created perceptions of promoting discrimination. This was quite evident as I listened to the discussions on the floor, and as I read the emails that I received yesterday. However, I firmly believe that HB 2453 does create a fertile ground for lawsuits. I do not think that prohibiting lawsuits as part of the bill is going to stop them. I vote no on HB 2453. — Shanti Gandhi.
Mr. Speaker: I vote no on HB 2453 because: 1. I believe it is unnecessary considering the constitutional amendment passed in 2005 and the Preservation of Religious Freedom Act passed in 2013; 2. The motive of the bill is a fear of a speculative federal appeals court opinion that may or may not find our constitutional amendment unconstitutional; 3. The bill would be personally hurtful to my friends when they are denied services available to everyone else based upon whom they love; 4. I believe the bill is much broader in scope than what was intended. —Tom Sloan, Don Hill, John E. Barker, Steven R. Becker.
Mr. Speaker: I vote no on HB 2453. My closely held religious belief is that God is love. I cannot vote yes for this bill if I am to heed the words of Christ when he said, “Inasmuch as you have done it unto one of the least of these, you have done it unto me.” — Don Hineman, Barbara Bollier, Tom Sawyer.
Mr. Speaker: This bill is not discriminatory against any group of people. It only ensures that individuals are not forced to participate in an event that is contrary to their religious beliefs. Questions arise for me on how this bill affects people receiving lawful government services they have the right to receive. I vote no on HB 2453. — James E. Toddd.
Mr. Speaker: I strongly support religious freedom, but this bill is not about religious freedom. In my opinion, this is about legalized discrimination, and I cannot vote in support of this. I vote no on HB 2453. —Patricia M. Sloop.
Mr. Speaker: I vote no on HB 2453. I support freedom of religion, but proponents of this bill concede it addresses issues which Kansans are not currently facing. Kansans are facing the consequences of 2011 education cuts. A study last fall shows only three states have cut education deeper. Adjusted for inflation, per pupil school funding is below 1992 levels. Schools are closing, class sizes are growing, parents are paying higher fees, and our economy is struggling. The next generation of leaders, innovators, and job creators is being molded today in Kansas classrooms. We must invest in them because strong schools are the foundation of a stronger economy. — Carolyn L. Bridges, Roderick Houston, Adam Lusker, Ed Trimmer.
Mr. Speaker: I support religious freedoms, however, I cannot support any legislation that condones or licenses discriminatory behavior against any person. I vote no on HB 2453. Gail Finney, Julie Menghini, Broderick Henderson, Tom Burroughs, Paul Davis.
Mr. Speaker: One of the founding principles of our country, inscribed in the First Amendment, is the right of the people to be led by their conscience and follow their own deeply held religious convictions without fear of penalty or reprisal. Because of that, I vote YES on HB 2453. — Connie O'Brien, Travis Couture-Lovelady, Willie Dove, Ronald Ryckman Sr., Brett Hildabrand, Jerry Lunn, Joe Edwards, Craig McPherson, Randy Garber, Richard Carlson, Leslie Osterman, Will Carpenter, Kevin Jones, Allan Rothlisberg, Joe Swiewert, Sharon Schwartz, Ken Corbet, Ron Highland, Amanda Grosserode.
Mr. Speaker: The Kansas Bill of Rights says, “The right to worship God according to the dictates of conscience shall never be infringed: ... Nor shall any control of or interference with the rights of conscience be permitted. ...” The bill's opponents have made false representations about new discrimination. States enacting same sex marriage – from New York to Hawaii – have also enacted specific protections for religious liberties as it relates to same-sex marriage, including Progressive governors like Andrew Cuomo and Martin O'Malley. Kansas is consistent with those states. It maintains the status quo. Nothing more, nothing less. I vote YES on HB 2453. — Charles Macheers, Keith Esau, Mario Goico, Jim Howell
Mr. Speaker: There are substantial legal conflicts surrounding a possible U.S. 10th Circuit Court of Appeals opinion striking down the Kansas marriage amendment. Because of that, it is imperative that we protect individuals from penalty if they choose to decline to participate in a marriage event that conflicts with their religious beliefs. I vote YES on HB 2453. — Kasha Kelley, Dennis Hedke, Kelly Miegs, Bud Estes, John Bradford, Kent Thompson, Reid Petty, Daniel Hawkins, Marvin Kleeb.
Topeka — Senate Minority Leader Anthony Hensley, D-Topeka, has pre-filed legislation that would require the governor to make public the names of people who apply for an appointment to the Kansas Court of Appeals.
Last year, Gov. Sam Brownback, a Republican, and his conservative allies pushed through a change in the way Court of Appeals judges were selected.
Now those judges are selected by the governor subject to confirmation by the Senate.
Prior to the change, the governor selected an appeals court judge from a list of nominees provided by a nominating commission.
Brownback selected his chief counsel, Caleb Stegall, as the first nominee under the new law.
The new selection process became more controversial when Brownback refused to divulge the names of those applying for the vacancy on the state's second highest court. Under the former system, the nominating commission released the names of those applying, its final recommendation and had even opened up to the public its interview process.
Brownback declined to make the applicants' names public, saying it would hurt the chances of getting qualified individuals to apply.
Under Senate Bill 252, the governor would be required to make each applicant's name and city of residence available to the public once the application process is over. The 2014 legislative session starts Monday.
In a question-and-answer period on Wednesday with the Kansas Board or Regents, Republican Gov. Sam Brownback provided some insight into the end of the 2013 legislation session in June in which Republican legislative leaders demanded cuts to the universities and Brownback accepted those cuts.
Brownback said at the end of a legislative session, "Often you're crowding everything into a chute, and we're going to get this done tonight — this is going to happen tonight, and then things happen and it doesn't always come out exactly the way your wanted it to come out. And things get traded here and there to get something on through the final process."
Brownback said perhaps the perception from legislative leaders was that higher education could handle the cuts. "You have a lot places you get money from, and maybe you can handle this, whereas other places don't have the options," he said.
On the final day of the session, Republican leaders mustered enough votes within their caucuses to pass a state budget that cut universities 3 percent over two years and to push through a tax package that increased the state sales tax while reducing deductions and racheting down income tax rates.
Brownback has made phasing out the state income tax one of his major goals.
Brownback has praised GOP legislative leaders, but has vowed to fight for restoration of the cuts when the 2014 session starts in January.
House GOP leader says state employee furloughs possible unless budget approved; measure putting brakes on Common Core in the mix
Topeka — Republican leaders in the House told their rank-and-file members that they needed to approve a state budget Saturday or state employees would face furloughs.
But some GOP House members said they felt like they were being given a take-it or leave-it option, and others said they would vote against the budget unless they get a chance to vote for a bill putting the brakes on Common Core education standards.
The dispute arose on the 99th day of the legislative session, which was supposed to end at 90 days and Republican leaders had earlier said would be finished in 80 days.
"We have a Republican House, Senate and governor and we need to get our work done," said House Majority Leader Jene Vickrey, R-Louisburg. "If we have bad results because of delays in our process … it has effects and those can affect all of us in the next year," Vickrey said.
Vickrey said the Legislature is facing constitutional deadlines to appropriate funds for the next fiscal year. "The governor can't spend money not passed by the Legislature," he said.
Some state payments for July 1 and beyond are written as early as June 10, he said. To get an approved appropriations bill prepared for Gov. Sam Brownback to sign into law takes at least 7 days, he said. Vickrey said furloughs of state employees, and non-payment of insurance for some state employees was "right around the corner." He said the House would take up the proposed budget later Saturday.
But Senate Majority Leader Terry Bruce, R-Hutchinson, said he didn't think any state employees were in any imminent danger of being furloughed, but he said the Legislature needs to approve a budget.
State Rep. Pete DeGraaf, R-Mulvane, said he was a "No" vote on the budget until the House gets a chance to consider a bill that would suspend work on Common Core and proposed science standards for schools. Tea party groups say Common Core standards represent a federal intrusion on schools, but supporters of Common Core say the standards will improve education and note that they were developed by states.
On the issue of adopting a budget, state Rep. Ed Bideau, R-Chanute, said legislators have known for weeks about approaching deadlines and that the overtime session is playing havoc with school districts trying to prepare for the next year. "It smacks a little bit of a cramdown," to be told the budget must be approved now, he said.
TOPEKA — Gov. Sam Brownback's administration expects tax revenue gains for the month of May, according to an email inadvertently sent Friday to the Lawrence Journal-World.
The email, from Chad Bettes, who is a high-ranking official in the Kansas Department of Revenue, to Sherriene Jones-Sontag, spokeswoman for Gov. Sam Brownback, even includes a prepared comment from Kansas Secretary of Revenue Nick Jordan. The actual revenue numbers were to be filled in later Friday.
Earlier Friday, Jordan urged House Republicans to break an impasse during the current overtime legislative session and approve measures that increase the sales tax but lower income tax rates. He said lowering income taxes would stimulate the economy. While higher sales taxes hit the poor hardest, he said the state spends $3.5 billion a year on safety-net programs for low-income Kansans.
Here is the email from Bettes to Jones-Sontag. The subject heading said, "Please advise of changes and/or approval":
Planning to send the numbers out between 4 and 4:30 p.m. -- State Tax Receipts Total $XX.X Million in May TOPEKA – May tax receipts exceeded estimates by $XX million, or XX percent, buoyed by one-time revenue attributed to taxpayers who accelerated income in advance of federal tax increases enacted earlier this year. Individual income receipts were $XX million more than anticipated, or XX percent, for the month. The increase over the estimate was due in part to balance due payments for 2012 income taxes, which were processed in late April and early May following the annual tax filing deadline. “It is important to be cautious when looking at these numbers because federal tax hikes proposed at the end of last year and passed in January likely influenced taxpayer behavior as people worked to ensure that income would be taxed at 2012 rates,” said Revenue Secretary Nick Jordan. “We have reaped the benefit of that at the state level in April and May, and now we expect things to return to more normal levels.”