Kansas lawmakers drop tax plan as some seek to boost schools

(KSNT File photo)

TOPEKA, Kan. (AP) — Kansas legislators on Tuesday abruptly dropped a newly drafted plan to fix the state’s budget with income tax increases because some lawmakers complained that it doesn’t raise enough revenue to also boost spending on public schools.

Republican leaders announced that the GOP-controlled Senate wouldn’t take up the proposal, even though they had planned to expedite a vote after House and Senate negotiators drafted it Monday evening. Negotiators’ bill would have raised $879 million over two years by rolling back past income tax cuts championed by Republican Gov. Sam Brownback.

The new plan was similar to a measure Brownback vetoed in February. The earlier bill had strong bipartisan support, and GOP leaders made changes to attract the two-thirds majorities necessary in both chambers to override another potential veto.

But Senate President Susan Wagle, of Wichita, told fellow GOP senators during a caucus: “That fell apart, so we’re back to the negotiating table.”

The Kansas Supreme Court ruled in March — days after Brownback’s tax-bill veto — that the state’s funding for its public schools is inadequate. Democrats and moderate Republicans who backed the earlier tax plan now argue that a new one has to be significantly larger to cover budget gaps and boost aid to the state’s 286 local school districts.

Kansas faces projected budget shortfalls totaling $887 million through June 2019. Its budget woes followed the income tax cuts Brownback sought in 2012 and 2013 and later economic slumps in agriculture and energy production.

Lawmakers could cover much of the gaps by diverting money from highway projects to education, social services and other programs, as Brownback has proposed. But they’d still be short of balancing the budget.

The Supreme Court did not specify how much the state must increase its $4 billion-plus in annual aid to schools. A House committee reviewed a plan Tuesday to phase in a $750 million increase over five years; some lawmakers question whether it’s enough.

The tax bill vetoed by Brownback would have raised more than $1 billion over two years. Senate Minority Leader Anthony Hensley, a Topeka Democrat, said the state needs to generate between $1.2 billion and $1.4 billion in new revenue over two years; some Democrats have even higher figures.

Hensley said the latest tax plan wouldn’t “even come close to a long-term fix.”

No Senate Democrat planned to support the new bill. While the GOP has a 31-9 majority, Republicans are deeply divided on tax issues, giving Democrats unusual leverage.

Meanwhile, GOP conservatives still want to pursue moving the state to a single personal income tax rate for all filers — an idea Brownback has endorsed. Kansas has separate rates, 2.7 percent for lower-income earners and 4.6 percent for higher-income earners, after eliminating a third tax for the wealthiest filers in 2012.

Both the plan Brownback vetoed and the latest one drafted would have returned Kansas to three tax brackets, with a top rate of 5.45 percent. Both also would have eliminated an income tax exemption for more than 330,000 farmers and business owners touted by Brownback as a pro-growth policy.

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