Much “Heavy Lifting” Remains on Taxes and School Finance

May 11, 2017 by

School Finance Bill Still Not Done

Snoopy Lifting Weights

The K-12 Budget Committee met again today hammering out a couple more amendments but not getting any closer to finished. In fact, by the end of the meeting it looked as if things my actually ratchet up tomorrow.

First order of business today was to deal with Aurand’s amendment to repeal the cost of living weighting and replace it with his “Local Excellence Budget,” a 5% local property tax levy that the 140 school districts with the lowest number of at-risk children could access to provide enrichment experiences for their students. After all the discussion they’ve had about how the Court was focused on at-risk students and closing achievement gaps, it seems counterintuitive to adopt a plan to give more money to students who are not at-risk, but adopt it they did on a 9-8 vote where Chairman Campbell had to cast the tiebreaking AYE vote. They voted immediately afterwards to repeal the cost-of-living weighting.

Also up for more debate was Schwab’s amendment requiring school districts to pay for ABA therapy if the parents of a child with autism asked for it. If adopted (and it has not been yet) any time a parent wanted ABA therapy for their child, the district would be required to provide it. ABA therapy is highly intensive (usually 20 to 40 hours per week of one-on-one therapy by specially trained therapists) and quite costly.

A few years back the state mandated that insurance companies provide coverage for ABA therapy. The typical cost to a premium, according to Schwab, is 27 cents/month. He argued based upon that figure that the cost to school districts is minimal. But the fact is that insurance providers do not cover what is provided by the school system; so under Schwab’s amendment, a district would have to find funds from either special education (if it’s in the student’s IEP) or their general fund if it’s not. Either way, the cost would be tremendous.

We also believe it is inappropriate for the legislature to mandate one specific therapy – or curriculum or teaching method or reading program – over another. The IEP process established under federal law calls for mutual agreement between parents and school officials on the best approach to meeting a child’s individual needs. Where there is disagreement, the law establishes a rigorous due-process system for parents to pursue.

ABA therapy may be considered as an intervention now and if it is determined that such therapy is the best course for an individual student, it can be used. Mandating that it must the used at the request of one member of the IEP team is counter to IDEA which requires that the team consider each child’s needs on an individual basis.

After much debate, Schwab withdrew his motion with the promise of bringing it back tomorrow with some adjustments.

Towards the end of the meeting, it became clear that some are thinking about using tomorrow to find ways to change the funding in the bill. There was a discussion of repealing the third “boutique” weighting, ancillary school facilities weighting, and perhaps increasing the LOB cap. These discussions lead to a testy conversation in which it became clear that, despite the Chairman’s stated desire to kick the bill out of Committee tomorrow, all bets would be off if they went down the road of changing the funding.

This should make for a lively and perhaps very long Committee meeting tomorrow.

The Odd Couple on the Tax Bill

What one normally would expect under the dome is for the Democrats and moderate Republicans to be a coalition of nearly all issues. That was not the case yesterday in the Senate vote on HB 2067, the latest income tax bill.

We will tell you that HB 2067 was an improvement over HB 2178, the earlier tax bill that the Senate passed and then failed to override the Governor’s veto but much has happened since then to change the calculus.

First, HB 2178 was before the Gannon decision. The bill would have reversed much of the Brownback tax disaster and filled the budget hole but there was nothing in it for funding increases to K-12 education. HB 2067, coming after the Gannon decision, needed to not only fund the budget but also to provide for an increase to K-12 funding ($150 million in the first year, $300 million in the second and so on). A fiscal profile shared during the Senate debate found that HB 2067 would have been over $170 million short in fiscal year 2019. In other words, while the bill reversed Brownback’s disastrous experiment and funded the budget, it would not have provided for ongoing funding for schools under the Gannon decision.

Sen. Jim Denning (R-Overland Park), the majority leader and de-facto leader on tax issues for Senate leadership, promised that there would be a follow-up bill to provide funding for schools. But Denning has a serious credibility problem. He told Democratic leaders he would vote to override the veto of HB 2178 if the House did and then reneged on his promise. And lately he’s been touting seriously bad ideas for school funding including tacking a $9.00/month charge onto utility bills. Democrats don’t trust that Denning will bring a school funding solution forward or that, if he does, it would be based upon fair tax policy.

So the no votes on HB 2067 yesterday came from an odd couple of Democrats who want a bill big enough to reverse the Brownback failed experiment, fund the budget, and fund our K-12 education system going forward enough to satisfy the Courts and keep schools open come August and hard right conservatives who are still in full support of Brownback as the state collapses.

Moderate Republicans and two Democrats voted aye, relying on a promise from Jim Denning of a separate bill for school funding that would come later. We would hope going forward that, if the solution is to be two bills, they would insist on those two bills being voted on at the same time.

The fact is that Denning is just as likely to bring a trailer bill forward that is insufficient- or based on very bad ideas like the utilities tax- as he is to simply not bring anything forward at all.

At this point it is important for elected representatives who are supporters of Kansas and Kansas schools to dig in and tell leadership the following:

  1. that they intend to end this session with an end to the Brownback failure,
  2. with a balanced budget,
  3. with increased school funding that satisfies the Gannon decision.

Moreover, they won’t end the session by passing unfair or inadequate funding bills, and they want a “trust but verify” relationship with Denning and Wagle. If leadership want to run two bills, then bring both forward together, run them on the floor back to back, and vote on them at the same time. No games. No hollow promises. Action.

 

 

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No Finance Bill Yet; Tax Debate in Senate

May 10, 2017 by

TAKE A 1-QUESTION OPINION SURVEY ON THE SENATE TAX PLAN BELOW

The K-12 Budget Committee met again today continuing to work on HB 2410. They started by adopting the Communities in Schools amendment from Melissa Rooker (R-Fairway) that simply eliminates some old language that is no longer applicable to the program.

Rooker then offered a motion to reconsider the amendment adopted yesterday on requiring schools to pay for ABA therapy for a child with autism if requested by the parent and supported by a medical recommendation. The Committee reviewed a letter from a KSDE attorney informing them that the requirement would violate the federal IDEA law by removing the IEP team from decision-making. The motion angered the maker of the amendment, Scott Schwab (R-Olathe), who said he was not going to act based on the opinion of one lawyer. It was Schwab who yesterday asserted that schools were sending children with autism to pet shops to pet puppies as therapy. Brenda Landwehr (R-Wichita) then weighed in declaring that our public schools were failing children with autism. When the vote was taken, it was eight to eight to reconsider. Chairman Larry Campbell (R-Olathe) cast a NAY vote breaking the tie and defeating the motion.

Next was an amendment by Landwehr that would require the State Department to present an annual report on accreditation to the Legislature and Governor. The amendment was adopted.

Clay Aurand (R-Belleville) returned to his amendment from yesterday on the corporate tuition tax credit program. Yesterday the amendment would have removed the requirement that private schools receiving students would have to out-perform the trend data on post-secondary success or the statewide average ACT scores. He withdrew the motion yesterday to rework it so that high schools accepting students would still have to meet those requirements but elementary schools would not. The new motion was adopted.

Another Aurand amendment on the corporate tuition tax credit program changed the definition of an eligible student from one direct certified by the Department of Children and Families back to an at-risk student (defined as on free lunch). He then added that 50% of those children would have to be direct certified by DCF. The amendment passed.

Jim Karleskint (R-Tonganoxie) expressed concern about language in the bill directing the SBOE to create an accreditation system based on student performance. He noted that the SBOE has just completed that work. The Revisor was directed to seek language that puts that section of the bill in the present tense and bring it back tomorrow.

The final amendment offered came again from Aurand. This one would repeal the Cost of Living weighting and replace it with a Local Enhancement Budget. This LEB is intended to allow districts to raise local property taxes to get money to spend on non-at-risk students for enrichment opportunities beyond the required curriculum. Schwab asked that the motion be divided. Part A of the motion would be establishing the LEB; part B would be repealing the Cost of Living weighting.

There was plenty of back and forth of this amendment raising many concerns. So many in fact that the committee ran out of time.

They will meet again tomorrow with the intent of addressing the Karleskint concerns, voting on the LEB motion, and giving Schwab the chance see if he can rework the ABA amendment to address the concerns of the KSDE legal team. Campbell hopes to vote on the bill on Friday.

Senate Takes Up a Tax Bill

It came as a surprise to everyone today that the Senate would take up a tax bill. House Bill 2067 was put together by the Tax Conference Committee and it was decided that it would be voted on today.

HB 2067 is a match of SB 30, the tax bill that was pulled from consideration in the House when it was found that it did not have enough support to pass.

HB 2067/SB 30 is a good policy bill in that it reverses the most damaging parts of the disastrous Brownback tax policy. It would restore the three income tax brackets, repeal the LLC income tax exemption, and end the glide path to zero. But unfortunately, while the bill would fill the holes in the budget, it would not provide the funds necessary to pay for HB 2410, the school finance plan crafted in the House. And one thing Legislative Counsel Jeff King told both the House K-12 Committee and all the Senate is that in order to pass Court muster, the state must show that the money is there. It is not there in HB 2067/SB30.

Passage of the bill would mean that they would be forced to develop yet another tax increase to address school finance. There are no promises or plans from Senate leadership on what that “trailer bill” would be or what tax it would raise.

Initially, the Senate voted the bill down on a vote of 18 – 22. They then reconsidered the action and voted to not adopt the bill, sending it back to conference where it can be used as the shell of a new tax plan.

Here’s what former State Budget Director Duane Goossen had to say to legislators about the plan:

Before you lend your support to something short of a full fix, I urge you to request the following of legislative leadership:

    1. Assurances of support. Legislative leaders should commit to upholding the position of the chamber. If they are unwilling to do that for a compromise similar to Senate Bill 30, it should serve as a red flag for legislators that it may not be a compromise at all. Rather, it is more likely a maneuver to lower the bar for negotiations and push through something much smaller that fails to restore stability to the state’s budget.
    2. A plan for schools. Failure to comply with a Supreme Court order to adequately fund public education will put schools in high danger of closing in August. If a tax package does not produce enough revenue to cover this, another funding source for schools should be clearly identified before voting on tax reform. As former Senator Jeff King stated in addressing the House K12 Budget Committee on Thursday, “if you promise to put in money, you have to have the money.”

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