Kansas struggles for budget fix on anniversary of tax cuts
TOPEKA, Kan. (AP) — Kansas legislators marked the fifth anniversary of Republican Gov. Sam Brownback’s tax-cutting experiment Monday by drafting and then rejecting a new plan for undoing much of the policy in order to fix the state budget and provide more money for public schools.
The House voted 68-53 against a plan that would have raised $1.2 billion over two years by boosting income tax rates and eliminating an exemption for more than 330,000 farmers and business owners. The House and Senate negotiators who drafted the plan will have to resume their talks.
The proposal split both parties. Some minority Democrats criticized the plan for not being enough. Kansas faces projected budget shortfalls totaling $887 million through June 2019 and the state Supreme Court ruled in March that education funding is inadequate.
But some conservative Republicans assailed the proposed tax increases as likely to damage the state’s economy and hurt small businesses and working-class families.
“The direction from the debate wasn’t fully clear,” said House Taxation Committee Chairman Steven Johnson, a moderate Assaria Republican. “What’s the delicate balance to the right or left that picks folks up without losing the others?”
Meanwhile, conservative Republicans outlined a new plan for keeping Brownback’s biggest political legacy — past income tax cuts — intact for another year. They argued that Kansas can fix its budget problems by restraining spending, and more than two dozen of them had a Statehouse news conference ahead of the tax talks.
“The approaches so far have all been spend more, raise more taxes,” said Republican Sen. Ty Masterson, of Andover, who outlined conservatives’ plan. “It’s like some sort of weird contest of who can raise taxes higher.”
The new tax plan would have undone most of the tax cuts touted by Brownback as pro-growth policies, though rates would remain lower than they were before the tax-cutting started in 2012. The state’s top rate would jump to 5.7 percent from the current 4.6 percent.
The conservatives’ plan would avoid such tax increases by keeping most spending at current levels and diverting money from highway projects to other uses. It wouldn’t provide any extra dollars for public schools, though Masterson said that issue could then be tackled separately.
And, though the plan would balance the budget through June 2018, the state would face projected budget shortfalls in the following 12 months using the state’s current revenue forecast.
“These are the same people who put us in the bankrupt position we’re at now,” said House Minority Leader Jim Ward, a Wichita Democrat. “I’m not really taking it too seriously.”
Brownback signed legislation enacting the first and biggest round of personal income tax cuts on May 22, 2012, promising a “shot of adrenaline” to the economy. Kansas has struggled to balance its budget since, and the problems persisted with later slumps in agriculture and energy production.
Voters turned on Brownback and his legislative allies last year, ousting two dozen conservatives from the Legislature to give Democrats and GOP moderates more power. Masterson lost his job as chairman of the Senate budget committee.
Yet conservatives retained enough clout to prevent Democrats and moderate Republicans from passing income tax increases with the two-thirds majorities necessary to override a potential veto. Republicans have shifted back and forth between working on such a revenue-raising plan and one Brownback might sign.
The Legislature’s annual session was supposed to last 100 days. The final scheduled day is Wednesday, creating urgency for lawmakers to move, but the House’s vote makes it all but certain that lawmakers won’t finish by then.
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