The Budget is a Reality Problem

The Kansas Legislature reconvenes next week, on Wednesday the 29th, to hammer out the budget. According to new revenue projections released this past Monday, the State will be short $800 million. That's right, almost a billon dollars short, and $200 million more than they projected it would be earlier this year.

To be sure, there are plans to make up that difference. The Governor has proposed $470 million of sin taxes and loopholes that have yet to be enacted by the Legislature. He also suggested stealing another $130 million from transportation. Again. But even if those proposals fly (there is a lot of resistance from the Governor's own allies in Johnson County to the sin taxes), there is still a budget gap of $130 million or so nobody knows how to bridge. (CJOnline)

Quite simply, there is not enough money to cover the business of the state. Laws have been passed this session that cannot be implemented unless they are funded. This is what we mean when we say that if a bill is not an "appropriations bill" then it hasn't really become law, not until there is money to implement it.

Case in point, the block grant school funding bill. Funding levels have been promised, school districts are making plans, but whether the grants actually get funded at the promised level remains to be seen. And if they do, then what will suffer in turn?

  • Working class Kansans: One likely source of money will be sales taxes. The Governor and his allies argue that taxes on food and other purchases affect everyone the same, the rich need as many calories as the poor do. But the rich have more to spend on purchases, and higher taxes on purchases don't eat into the rest of their budget for rent, health care, and opportunity. Especially since, in Kansas now, those rich business owners can spend the money they used to pay as income tax. (Washington Post)
  • Education: Rumors are flying in the statehouse that, if K-12 education is spared from any (further) cuts, then higher education in Kansas will take the brunt. This despite a current proposal to spare cuts to universities if they refrain from raising tuition. See? Nothing is set until money has been appropriated. (CJOnline)
  • Transportation: Since 2011, more than half a billion dollars have been appropriated from the State Highway Fund for non-transportation related needs. $103 million was already taken out in January, and in his budget proposal yesterday, the Governor suggested taking another $139 million to help cover next year's shortfall. (LJWorld)
  • Retirement: Earlier this month, Governor Brownback signed a bill authorizing $1 billion in bonds for KPERS, the state retirement system. Recall that KS has been downgraded by several international credit rating agencies, making our bonds worth less, and recall that KPERS funds have routinely been swept up for use elsewhere in the budget. This puts the retirement system, and the state, in the crosshairs if revenue continues to fall. (CJOnline)
  • Healthcare: The Governor's suggestions to fix this budget problem also include hiking fees to the insurance companies carrying KanCare, while continuing to blockade any expansion of Medicare (and the millions of dollars it would bring to healthcare in Kansas). (KHI)

In the end, as it has been since the start of this session, the answer is simple. Restore the revenue lost to the disastrous income tax cuts of 2012. We do not have a spending problem, as some in the Legislature like to say, we have a reality problem.

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