Yes, Governor Sam Brownback and his legislative allies have delivered another budget bill that has resulted in another credit downgrade for the State of Kansas.
In response to a budget bill that takes another $185 million out of funds earmarked for the Kansas Department of Transportation, credit rating service Moody’s have moved the outlook on Kansas highway revenue bonds from “stable” to “negative.” This the fourth credit downgrade Brownback has earned for the state.
Essentially Moody’s is saying that if you are thinking of buying Kansas highway revenue bonds, you might want to think twice because the state has made a habit of taking highway funds to fill holes in the state general fund.
The Governor and some legislators – Senator Forrest Knox, in particular – have been touting the small increase in revenues collected over estimates in April as proof that the “sun is shining in Kansas.” Yes, April revenues came in $2.6 million above estimates but one must not lose sight of the fact that the estimates have been lowered repeatedly since the Brownback tax cuts took effect.
It’s like this…If I estimate that my monthly paycheck will be $1000 and I actually get $900, I might lower the expectations for next month. Now I expect $900 and I get $850. Eventually I can lower my expectations to the point where my income might actually exceed my expectations. I’m still earning less than I need to pay my bills, but at least I’m making more than I thought I would.
And as for that $2.6 million, under the budget passed this weekend the Governor will need to come up with more than $100 million in sweeps and cuts. It’s really not time to celebrate.
Watch a video interview with KNEA Director of Legislative and Political Advocacy, Mark Desetti answering some of your questions about the state budget bill, KPERS, and the LLC tax holiday.