Topeka ? Gov. Kathleen Sebelius on Tuesday proposed balancing her budget with $400 million in accounting maneuvers, expanded gaming and no new taxes.

In response, Senate President Dave Kerr, R-Hutchinson, unwrapped a sweatshirt he said he had been saving for 12 years. On the sweatshirt was written: “A politician thinks of the next election; a statesman thinks of the next generation.”

Kerr said Sebelius had offered politically easy solutions that would compound state fiscal problems in the future.

“There is nothing here that is a structural fix to the problem,” Kerr said of Sebelius’ plan. “This is difficult stuff, and she has dealt with it in an artificial fashion.”

House Speaker Doug Mays, R-Topeka, agreed. “This is a plan based on debt, gambling and making people pay their taxes early,” Mays said. “We’ll run it, but I don’t know how much support it will get.” If it is approved by the Legislature, he said, “We’ll be right back in the same situation next year.”

But neither Kerr nor Mays proposed any alternatives. Nor have any other lawmakers, and the Legislature’s first adjournment is April 4, leaving little time for alternatives.

Sebelius had proposed a $4.49 billion general fund budget for fiscal year 2004, which starts July 1. Because of the state’s slumping economy, tax receipts have been projected to fall at least $230 million short. In addition to covering the budget hole, Sebelius has also said she wanted about $170 million in reserve to cushion possible revenue shortfalls later in the fiscal year.

Under Sebelius’ proposal, the state would :

l Allow casino-style gaming at horse and dog tracks;

l Move up the second-half payment of state property taxes by one month;

l Make quarterly income tax withholding filers to file monthly;

l Grant additional tax amnesty to collect more delinquent taxes;

l Issue $175 million in bonds that would be used to fund highway projects. The bonds would be paid off by tobacco settlement money that had previously been earmarked to create an endowment for children’s programs.

Critics respond

Republicans generally delivered a chorus of criticism.

“It’s remarkable,” said Sen. Derek Schmidt, R-Independence, “We borrow from tomorrow and fudge the books today.”

¢ 6News video: Governor presents ’04 budget¢ See other state budget stories

But Sebelius and her fellow Democrats defended the proposal as the best that could be done in tough economic times.

“Many elements of this plan represent one-time solutions,” Sebelius said. “Some may rightly be called stop-gap measures. Some will disagree with this approach — and I understand. That is their right.”

The proposal also caught the ire of social service advocates who perceived Sebelius was trying to avoid proposing a tax increase for political purposes.

“We are disappointed that this patch-through budgeting by the governor appears to put no new taxes ahead of people first,” said Shannon Jones, spokeswoman for the Big Tent Coalition.

But Sebelius said that she couldn’t endorse a tax increase because the economy continues to struggle with massive layoffs in the aircraft manufacturing sector, and her administration continues to find cost-savings within government.

“These reforms leave me convinced we must maintain a tight-fisted, sharp-penciled approach in our fiscal year 2004 revenue package,” she said.

Republicans said her proposals were fiscally dicey. Lawmakers rolled their eyes at the proposal to borrow $175 million to finance highway projects, back the loan with tobacco settlement money, and back out highway dollars and put them in the general fund.

“We need to take a serious look at whether we want to deficit spend. Funding general fund with debt is very disturbing. I’m not sure we want to go down that road no matter how bad the revenue picture is,” Mays said.

No tax increase, for now

State Sen. Mark Buhler, R-Lawrence, was unimpressed with Sebelius’ plan.

“I’m disappointed. I thought she’d be willing to talk about tax revenue,” Buhler said. “This isn’t her problem completely to solve, so I guess I have some empathy, but I thought she would have a better plan.”

Senate Democratic Leader Anthony Hensley of Topeka said Sebelius’ proposal recognized the fact that many Kansans were suffering economically and wouldn’t be able to handle a tax increase. He said if Republicans don’t like the plan they have a responsibility to offer an alternative.

But Kerr refused to take the bait. He said the Senate would debate her plan and if it failed “either she or we will have to come up with a plan.”

Sebelius’ package was unveiled as the House started debate on her 2004 budget.

Some Republicans sought to increase funding for public schools to a level before they were cut during the past year. But Democratic allies of Sebelius and other Republicans said it would be irresponsible to increase the size of the budget hole with no revenue package in place to bridge the gap.

Rep. Tom Sloan, R-Lawrence, proposed an amendment to the budget to give state employees a 2.5 percent pay raise. Sebelius had proposed a 1.5 percent pay increase, but House budget writers had rejected any pay increase. Sloan’s amendment was defeated 77-20.