Logic, Budgets, and Taxes

May 3, 2017 by

We have a belief in the logical order of decision making. That is, since the state is out of money and can’t fund its current budget, there will need to be a revenue/tax bill passed that allows state services to continue. We also know that the legislature must meet the Supreme Court ruling in Gannon. So our logic is to approach this in a specific order. First, pass the new school finance formula that determines how much money is needed for K-12 education. Second, pass a state budget that spells out funding for all state agencies/services. Finally, pass a comprehensive tax plan that allows the budget to be funded.

Putting the tax bill first constrains actions on the budget and school finance.

But logic does not always apply under the dome.

Right now both chambers are arguing about tax policy while the school finance formula and budget are stalled.

Many legislators are fighting for the application of a logical order. They want to make only one more vote on taxes and they want that vote to both fill the state’s budget hole and fund our schools.

Yesterday a planned tax vote in the Senate was pulled and today the same thing happened in the House. That’s not bad news. It is a result of legislators making the case for logic and denying votes for a bill that does not solve the two problems they face.

What it is important to remember now is that we are only three days into this veto session and the legislature has 24 days available and budgeted. There is no reason to panic and ignore rational decision making. And while we all want this done, it is more important that it be done right.

K-12 Budget Committee Considers Taxes in School Finance Bill

Within this ongoing debate about how much in taxes and what to pay for, the House K-12 Budget Committee met today to talk about the possibility of putting dedicated tax increases in the school finance formula bill to pay education increases.

The first part of the discussion was simply whether or not that was constitutional under the “two-subject” rule. Since the bill already contains at least one tax provision – renewal of the statewide 20 mill property tax levy – it would appear to be legal, provided that the proposals in the bill specifically reference paying for provisions in the bill.

After some discussion including asking questions of House Tax Committee Chairman Steven Johnson (R-Assaria), there did not appear to be consensus on whether or not this was a good idea. One problem brought up by several legislators is that even if this legislature put the taxes in the bill and targeted them to education, future legislatures would be free to sweep those revenues for other purposes.

The Committee will meet again tomorrow to hear from Jeff King, the attorney hired by the legislature to advise the Committee on the likelihood that this bill would be found to be constitutional.

Tax Agreements Scheduled for Votes; Votes Cancelled

Things indeed seem messy in the quest to find a tax bill that will fill the holes, fund our schools, and get enough votes to override an expected veto by the Governor (84 in the House; 27 in the Senate).

The first tax bill this session (HB 2178) easily passed both chambers before being vetoed by Governor Brownback who insists that his failed tax experiment is working. The House secured 85 votes for an override but the Senate failed to get to 27.

It was said that the Senate would be voting yesterday on a new tax bill but the bill in question would not have raised enough money to fix the problems facing the state right now let alone fund a new school finance bill. Leadership did not bring the bill forward for a vote.

Instead, the tax conference committee met again to hammer out another bill, this time putting it in a Senate bill so that the House would vote first. That vote was expected after lunch today but again, the vote was delayed. As we write this update, we are waiting for the House to reconvene. Rumors under the dome are that the bill is still short of what is necessary for funding and so is also still short of the needed votes. If this is true, it is very likely that there will be no vote today.

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