Kansas lawmakers are beginning to gain traction on some key policies as they approach first adjournment on April 7. While budget and school finance dominated the week, some are saying that any real movement on a tax revenue package is expected to hold off until Veto Session.
Rescission Bill in Conference
The first conference committee of the year began meeting Thursday on Senate Substitute for Substitute for House Bill 2052, the rescission bill, which reconciles this fiscal year’s budget in the black. The Chair, Vice Chair and Ranking Minority Member from both the Senate and House budget committees began ironing out differences between their proposals with little contention thus far.
Negotiators have agreed on the key measure of the bill, which borrows just enough from the state’s long-term investment fund to leave an ending balance of $50 million on June 30, 2017 with the six-year repayment beginning in FY19. One remaining item of difference surrounding repayment to the Kansas Public Retirement System (KPERS) may be saved for Omnibus, the catch-all spending bill at the end of session.
Senate Advances Biennial Mega Budget
The Senate Ways and Means Committee kicked out their biennial budget for FY18 and FY19 Thursday. Substitute for Senate Bill 189 looks little like what the Governor proposed in January and rejects some of the major provisions in his plan including: securitizing future tobacco settlement revenue, freezing state contributions to KPERS at FY16 levels, requiring joint procurement on goods and services, consolidating school health benefit plans, creating a rural teacher scholarship program, creating a KU Med Dental School, and merging some state agencies.
The key addition was combining with the judicial branch’s budget – which had been separated from the state’s mega budget in recent years – and using their requested enhancement for salaries and giving a 2% raise across the board to all state employees, totaling $22 million.
House Committee Approves Renewal of STAR Bonds
The Sales Tax As Revenue (STAR) Bond program received initial approval from the House Appropriations committee on Wednesday and is now headed to the full House.
House Bill 2184 renews the program until July 1, 2022 and eliminates language allowing a county commission or school board to protest a proposed STAR Bond project if determined to negatively impact property tax revenues. The bill also no longer requires the Secretary of Commerce to approve a city or county to use transient guest tax toward bond payments.
STAR Bonds provide Kansas municipalities the opportunity to issue bonds to finance the development of major commercial, entertainment and tourism areas and use the sales tax revenue generated by the development to pay off the bonds. We are supportive of the STAR Bond initiative and look forward to bringing projects like this to southeast Kansas.
Legislators will be on the floor all this week debating bills, while conference committees are scheduled to meet next week. First adjournment is currently set for April 7, but statehouse buzz is that the Legislature could break a few days early. Without many bills passed and in conference yet, leaders might prefer saving some days for the hard work that’s expected during the Veto Session.