Kansas tax collections $47M short of expectations in January

TOPEKA, Kan. (KSNT/AP) — Kansas collected $47 million less than anticipated this month, signaling that Gov. Sam Brownback and legislators may have to be more aggressive with spending cuts or other measures to balance the budget.

But the Department of Revenue said Friday that a key factor was greater-than-expected income tax refunds during the month and that the federal government is processing returns more quickly than it did last year. Spokeswoman Jeannine Koranda said tax collections could “even out” next month.

House Democratic Leader Tom Burrough said these numbers are like a financial nightmare.

“It’s a nightmare that will end tragically if the Governor doesn’t wake up soon,” said House Democratic Leader Tom Burroughs. “There are only so many excuses and short term fixes available, but the Governor has tapped most of them out. How much worse does it have to get before Governor Brownback admits his failed economic experiment is leading to a meltdown of every public service upon which Kansans depend?”

Currently, the Republican-dominated Legislature is working on proposals to eliminate a projected $279 million shortfall in the current budget, which ends June 30. Brownback’s budget director has said if lawmakers don’t pass a budget-balancing bill by Feb. 13, the state may not be able to pay its bills on time.

“What also happened are sales tax and use revenues, so the money that you pay on items when you going to the store, or that use tax is the tax on items bought out of state and brought into the state and that was less than we had expected for the month.” said Jeannine Koranda, Department of Revenue spokesperson.

The budget gaps arose after lawmakers aggressively cut personal income taxes in 2012 and 2013 at Brownback’s urging to stimulate the economy. The state dropped its top rate by 29 percent and exempted the owners of 191,000 businesses altogether.

“These numbers couldn’t come at a worse time with the state two weeks away from not being able to pay its bills,” said Senate Democratic Leader Anthony Hensley. “Gov. Brownback’s inadequate approach does not solve the problem. It only perpetuates what we already know – his economic experiment has failed. It’s time for real solutions.” stated Senate Democratic Leader Anthony Hensley.

The current projected shortfall is pegged to revenue estimates that were made in November, showing the state collecting $560 million in taxes in January. Kansas actually took in $513 million, or 8.4 percent less. And since the current fiscal year began in July, the state has collected $59 million less in taxes than the $3.3 billion anticipated, a revenue shortfall of 1.8 percent.

“We are glad that Kansas taxpayers are getting their refund checks earlier than last year,” Revenue Secretary Nick Jordan said. “Unfortunately, that negatively affects our tax receipts for this month.”

KSNT News spoke with the senate president who says lawmakers will just have to make more spending cuts moving forward.

“I think the state is just going to have to do what most Kansans have done, and that is tighten the belt, you know, ride the waves, get through it, and look for better times.” said Republican Senator Susan Wagle.

The state also faces a projected $436 million budget shortfall for the next fiscal year against projected spending of about $6.2 billion.

“How much worse does it have to get before Governor Brownback admits his failed economic experiment is leading to a meltdown of every public service upon which Kansans depend?” said House Minority Leader Tom Burroughs, a Kansas City Democrat.

House Speaker Ray Merrick issued the following statement:

“Because the numbers that our budgets are based upon are estimates and can fluctuate, the House Appropriations Committee is working to build additional contingencies into the Governor’s proposed rescission bill. Despite the revenue news today, the House continues to be focused on solutions that will protect core state services as well as Kansas taxpayers.”

 

 

The Associated Contributed To This Story

 

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