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Kansas Liberty: 19 October 2009
Appropriations Committee continues to address budget crisis, vice chair concerned about Dems calling for tax increases for schools
Financial crisis may finally make schools 'participate in cuts'
The House Appropriations Committee met last week as part of a series of gatherings taking place prior to the start of the 2010 Legislative Session to discuss ways to address the state’s budget crisis.
One big worry surfaced: Lawmakers may not yet have gotten the message that education is not an "untouchable" funding area.
“I still operate under the fear that we have a majority in the Legislature that doesn’t think that schools should participate in those cuts,” Rep. Jason Watkins, vice chair of the Appropriations Committee, told Kansas Liberty.
Speaker of the House Mike O’Neal, R-Hutchinson, requested that the Appropriations Committee start addressing the state’s budget crisis before the start of the legislative session to get a head start on the process of creating a strategy to offset the budget deficit.
Overall, the fiscal-year-to-date numbers reflect a deficit of about $67.2 million, or 5.3 percent below the estimates. The state’s tax revenues are coming in below last year’s receipts, with the majority of the loss in taxes coming from individual income taxes, which signals a drop in the work force. Kansas’ unemployment rate is at 9.6 percent.
Watkins said he expected the state to experience an additional estimated $500 million deficit in fiscal year 2010. Watkins, R-Wichita, said the number could be expected to fluctuate between $400 and $600 million depending on the economy.
Budget cuts to address the additional $400-$600 million deficit would have to be made on top of the cuts the Legislature already made to the fiscal year 2010 budget during the 2009 session. House leaders and Senate Republicans attempted pass bills that would have made much more substantial cuts, but because of alliances between moderate Republicans and Democrats made in both the Senate and the House, these bills were defeated.
Watkins said it was too early to forecast what the state’s budget situation would look like in fiscal year 2011.
Last week’s meeting centered on discussing possible ways to make additional cuts, and many conservative Republicans are continuing to look at K-12 as a way to decrease state spending.
The committee also discussed the possibility of school consolidation to save funds, identifying state agencies that could possibly be scaled back or eliminated, and possibilities for spurring job growth within the state as a way to increase revenues.
Watkins said one of his greatest concerns was that Democrats would start calling for tax increases as a way to maintain school funding at the level districts are demanding, and funding for other state agencies. Watkins pointed out that Democrats had already started planting the idea that tax increases are necessary.
“We have the Democrats who will likely say that we have cut enough and that now we have to start raising taxes,” he said.
Watkins noted that even Democrats outside the Legislature are starting to make their case for tax increases. For example, earlier this month Joan Wagnon, secretary of the Department of Revenue, made comments to the press that tax cuts were to blame for the state’s fiscal crisis.
“Those rumbling for tax increases are already out there,” Watkins said. “They refuse to give any consideration of what would have happened if we had not given those tax cuts. Those cuts we made lead to economic growth, and our situation would have been worse had we not made those cuts.”
The only situation in which legislators would not have to make the additional cuts to the fiscal year 2010 budget is if Gov. Mark Parkinson steps in and makes allotments.
The law stipulates that the governor can make allotments to get the state’s budget out of the red, without any approval from the State Finance Council. If the governor wanted to gain a positive balance of up to $100 million, he could do across-the-board cuts, but only after gaining approval from the State Finance Council. Although both of these actions are within the governor’s power, he is not required to take either action.
Parkinson already has made some allotments during interim, including cutting a crisis pregnancy initiative, and making minor cuts to state agencies. However, after the September estimates came out $67 million below the estimate, he said it was “too early to panic” and has yet to issue an announcement of any new allotments.
Parkinson’s spokesperson, Beth Martino, said Parkinson would continue to observe the state’s budget situation before making any additional cuts.
“The governor will continue to closely monitor the state budget situation, including October revenues,” Martino told Kansas Liberty. “It is too early to discuss taking action on the budget at this point.”
Watkins said he didn’t believe that Parkinson would make the necessary cuts to balance the budget.
“We are starting to see some indications he doesn’t want to handle the political heat,” Watkins said. “Which means the Legislature will have to step in and do his job.”
Previously on Kansas Liberty
- As tax estimates drop, education-funding supporters demand more money:
State sovereignty bill passes House, tax debate scheduled for tomorrow