photo by: Peter Hancock

House and Senate tax negotiators agreed Tuesday night to put yet another tax bill up for a vote, starting Wednesday morning in the House. The new bill would raise less than 00 million a year through a combination of income taxes, sales taxes on selected services and higher liquor taxes.

The Kansas House plans to debate both a new tax bill and the long-awaited new school finance plan on Wednesday as the 2017 legislative session goes into its 100th day.

House and Senate tax negotiators agreed around 8 p.m. Tuesday to put yet another tax package up for a vote. The latest version is smaller than the one the House rejected Monday night that would have rolled back many of the income tax cuts that Gov. Sam Brownback championed in 2012, generating in excess of $600 million a year in new income tax revenue.

Instead, the latest proposal from House Republican leaders would generate less than $500 million a year through a combination of smaller income tax hikes, an increase in liquor taxes and the repeal of some sales tax exemptions on services.

“I understand that you want to test the temperature again in the House. We are more than willing to allow that,” Senate tax committee chairwoman Caryn Tyson of Parker said in accepting the House’s offer.

But it remained unclear Tuesday night whether the new, smaller plan could get enough votes to pass the House. And even if it does, it may face stiff opposition in the Senate, which has never debated nor even held hearings on some of the elements in the new plan.

The plan also would require lawmakers to delay some payments into the state pension plan in order to close the projected revenue shortfalls over the next two years. Also, any additional money needed to fund a new school finance plan would have to be raised in separate legislation.

Republican leaders in the House and Senate have said they want to separate the issues of funding schools and funding the rest of the budget. But Democrats and many moderate Republicans have said they want a single tax bill that provides a long-term structural fix to the state’s revenue shortfalls.

Democrats and moderates also have said they would prefer to vote on a school finance package first, so they have a better idea of how big of a tax increase will be needed for the next two years. But GOP leaders, hoping to limit the size of the tax increase, so far have insisted on resolving the tax debate first.

It was not clear Tuesday night whether House leaders would allow the school finance debate to occur Wednesday afternoon if the tax bill fails in the morning.

The school finance plan would reinstate a kind of per-pupil formula similar to the one lawmakers repealed in 2015, setting base state aid at $4,006 per-pupil, with weightings added to certain categories of students to reflect the higher cost of educating low-income and bilingual students.

Overall it would add $180 million in new school funding in the 2017-2018 school year, followed by another $100 million increase the year after that. The per-pupil formula would then be adjusted with inflation in each subsequent year.

Public education advocates have said they think that’s too little, and they are hoping to amend the bill on the House floor to provide more funding.

GOP leaders, however, are expected to invoke a rule to prevent amendments that would add more spending. The so-called pay-as-you-go rule, or “PAY-Go” prohibits adding expenditures to an appropriations bill once it has come out of committee unless equal or greater cuts are made somewhere else as part of the same amendment.

Those who want to add more spending, however, argue that the majority of the bill’s subject matter deals with education policy, so the PAY-Go rule should not apply. It’s an issue that will be decided by whichever side can muster 63 votes to either apply or not apply the rule.

Lawmakers are coming under increasing pressure to break the logjam and finish out the session quickly. Tom Day, director of the Department of Legislative Administrative Services, said Tuesday that lawmakers are on the verge of exhausting their budget for this legislative session. In fact, much of the Legislature’s seasonal clerical staff was discontinued back on May 5. The only clerical staff still in the building are those assigned to the major tax, budget and school finance committees.

Day said he has already notified House Speaker Ron Ryckman and Senate President Susan Wagle that there are only a few more days worth of money in the budget to continue the session. If the session does continue, though, he said there are limited funds that can be shifted from other parts of the Legislature’s budget.

Other action Tuesday

Meanwhile on Tuesday, lawmakers passed and sent to Gov. Sam Brownback a few minor bills. Most of the day, though, was spent with House Republican leaders huddling behind closed doors, trying to regroup after Monday’s failed attempt to pass a tax bill.

The Senate gave final passage to House Bill 2277, which some people have started calling the “street party bill.” It allows cities and counties to designate “common consumption areas” where people can drink alcohol without having to remain inside the establishment where they purchased the drink.

It came mainly at the request of the city of Lenexa, which is developing a new “City Center” project that will feature a number of small retail establishments sharing a common courtyard. The idea is that people can buy pizza from one place, beer or wine at another, and sit at tables in the courtyard area.

But it could also be for temporary festivals or special events. So if the city of Lawrence, for example, wanted to block off part of Massachusetts Street on a night when the Jayhawks are in a major game, the bill would provide for that. However, drink cups would have to bear the name of the establishment that sold the drink, and bar owners would be liable for any violations that occur off of their premises but within the common consumption area.

The bill originally passed the House on April 3, 114-11. The Senate added a few unrelated amendments, one of which eliminates the 10-day waiting period for membership in a private club, then passed it on May 16, 35-5. The House on Tuesday concurred in the Senate changes, 97-22.

The Senate, meanwhile, gave final passage to a bill dealing with the state pension system and working after retirement. Generally, the Kansas Public Employee Retirement System frowns on “double-dipping,” when someone retires to collect their KPERS benefits and then goes back to work at a job that no longer contributes into KPERS. But a number of public agencies, school districts in particular, say they sometimes have no choice but to hire retired employees for certain hard-to-fill positions, such as math or special education teachers.

Senate Bill 21 cleans up existing law governing working after retirement. One of the key parts is that starting Jan. 1, retirees under age 62 will have to wait 180 days before returning to work, and there can be no prearranged agreement about returning to work. Retirees over age 62 would only have to wait 60 days. There are other provisions dealing with how much the retiree is allowed to earn, and how much the employer needs to pay into KPERS while the retiree is working.