The Sentinel-Record

Kansas tax hike hailed as fix doesn’t quite balance budget

- JOHN HANNA

TOPEKA, Kan. — The big income tax increase Kansas legislator­s enacted over Gov. Sam Brownback’s veto won’t balance the budget by itself, despite immediatel­y boosting the state’s credit outlook.

Even though the reversal of most of Brownback’s income tax cuts will inject $1.2 billion in new revenue through June 2019, lawmakers will have to continue relying on some of the same fiscal patches they’ve employed in recent years to keep the books balanced as state law requires.

“It’s going to take years to dig out of the hole,” said Sen. Laura Kelly, a Topeka Democrat who helped negotiate the final version of this year’s budget legislatio­n.

Part of the reason for the ongoing shortage is the spending increase for public schools that legislator­s approved last month to meet a state Supreme Court mandate. However, the state’s budget problems were deep enough that the GOP-controlled Legislatur­e couldn’t raise taxes — or cut spending — enough to fix all of them at once and still get the supermajor­ities needed to override Brownback’s veto.

“In essence, they’ve converted a super-large project into a medium-sized or small problem,” said John Hicks, executive director of the National Associatio­n of State Budget Officers. “Things are rarely done or completely resolved in one action.”

State lawmakers and commentato­rs outside Kansas read the GOP-controlled Legislatur­e’s action on taxes earlier this month as a repudiatio­n of the tax-cutting experiment the conservati­ve governor launched in 2012, which he touted as a national model. They also saw it as a timely rebuke of President Donald Trump’s plan to cut federal income taxes, which contained some similariti­es.

Kansas faced persistent budget problems following the Brownback-inspired tax cuts. The bill enacted this year over his veto largely rolls back those policies, raising rates and eliminatin­g an exemption for more than 330,000 farmers and business owners.

After legislator­s overrode Brownback’s tax veto, Moody’s Investors Service changed its outlook for Kansas’ credit rating from negative to stable and described the event as “credit positive.” It said in a report that the tax increase will reduce the state’s budget problems to “more manageable dimensions.”

The governor has blamed the state’s budget woes on slumps in agricultur­e and energy production. Through last year, a more conservati­ve Legislatur­e appeared to agree with him.

Lawmakers tinkered with income tax deductions in 2013 and raised sales and cigarette taxes in 2015 to patch budget holes. They also siphoned money from highway projects and scaled back contributi­ons to public pensions.

Voters turned Brownback’s legislativ­e allies last year, electing more Democrats and moderate Republican­s. New lawmakers said repeatedly that voters told them to find a permanent budget fix.

But the bipartisan group of legislator­s that repudiated Brownback’s policies still produced 2018 and 2019 budgets that wouldn’t balance without siphoning money from highway projects and shorting pension contributi­ons — a total of about $830 million over two years.

Brownback’s fellow conservati­ves took note and a few quickly appropriat­ed an anti-Trump hashtag on Twitter, #YouWereDup­ed.

“This is so we can pretend that we have a balanced budget, that there has been some sort of structural fix,” said Sen. Mary Pilcher-Cook, a conservati­ve

 ?? The Associated Press ?? KANSAS BUDGET: Kansas Gov. Sam Brownback speaks June 7 in Topeka, Kan. Brownback signed a bill Thursday that would increase spending on the state’s public schools in an effort to comply with a court mandate.
The Associated Press KANSAS BUDGET: Kansas Gov. Sam Brownback speaks June 7 in Topeka, Kan. Brownback signed a bill Thursday that would increase spending on the state’s public schools in an effort to comply with a court mandate.

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