Legislative Updates

Legislative Update - Week 4 - January 26-30, 2009

The Kansas House made history this week when Republicans united behind a significant budget reduction bill, overcoming incredible odds and efforts to divide the 76 members of the GOP.

As you may know, the minority party Democrats has been able to insert their will into legislation by carving off a slice of the Republican majority, the so called moderates, convincing them to vote with the Democrats. Some recent examples would be gaming legislation and immigration. No one familiar with House history can recall an appropriations bill passed by Republicans.

Led by newly minted House Appropriations Chairman Kevin Yoder, the House debated and held off a series of politically attractive amendments offered by their colleagues from across the aisle. The key to their success was making a shrewd political move to restore funding to public education that had earlier been cut much deeper by the Appropriations Committee. With that strategic move, moderate Republicans were able to coalesce behind the plan and victory was secured for Speaker O’Neal and Chairman Yoder.

The budget issue has dominated the first month of the session, with lawmakers forced to trim $300 million from the current year budget to avoid red ink. More reductions are also on tap for the FY 2010 budget where a deficit of nearly $1 billion was predicted if no reductions were achieved.

The major differences between the Senate approach and that taken by the House lies in budgets for public education. The House cuts education spending by $66 per student, with an overall reduction of $32 million for public education. By contrast, Senators cut school spending by $7 million in their budget bill. The House, taking larger cuts in education, did not have to reduce spending as deeply in other areas such as public safety and programs for the disabled.

Budget negotiations will continue through Friday and possibly into the weekend, with hopes that an agreement can be reached and a bill sent to the Governor by next week.

Budget subcommittees are already starting work on the FY 2010 budgets with agencies illustrating the impact additional cuts will have on services for the public. Significant and alarming projections are being made as agency leaders work with policymakers to identify all possible options.

FEDERAL STIMULUS?

Lt. Governor has assembled a team of the Governor’s top agency chiefs and others to help guide decisions regarding funds anticipated from the federal stimulus package working its way through Congress. While legislators are hopeful the package can help lessen the burden of cutting budgets, they are not assuming any revenue will be received in time to impact deliberations this session.

According to early estimations, Kansas could be in line to receive more than $1.7 billion, but State Budget Director Duane Goossen is quick to point out that much of the proposed revenue comes with complicated requirements and restrictions. Very little could be available to merely fill budget gaps, although the funds would be quite beneficial in meeting state Medicaid needs and other programs that would otherwise go unfunded. In addition to helping meet increasing needs for Medicaid, the funds would also represent opportunities for highway construction projects and deferred maintenance projects on colleges and universities.

SMOKING BAN ADVANCES

Legislation to ban smoking in most public places statewide will be debated by the full Senate next week. S.B. 25 was advanced by the Senate Public health Committee, generating support from conservative and moderate Republicans, as well as Democrats. Few exemptions exist in the bill as it is currently drafted, but it is likely to be amended when the Senate considers the measure with likely amendments to include state owned and operated casinos, among other possible added exemptions.

ANNEXATION

The issues surrounding municipal annexation resulted in legislation which had hearings in the House Local Government committee this week. The bills heard would substantially change current law dealing with unilateral annexation and the ability of cities to utilize this annexation option. HB 2030 would require that a city receive written permission before annexing any unplatted tract of agriculture land of 21 acres or more. Opponents argued that citizens would rarely agree to an annexation of large parcels of land like this bill would cover therefore severely limiting cities ability to grow and allow for economic development. HB 2031 similarly limited the cities authority in regards to annexation making it necessary for a majority vote of registered voters who reside within the area proposed to be annexed.

"STRONG" BEER

Federal and State Affairs committee (chaired by Salina’s Senator Pete Brungardt) held hearings this week on a bill which would change the definition of cereal malt beverages by increasing the limit on alcohol content from 3.2% or less to 4.0% or less by weight. This would allow the newly redefined CMB’s to be sold in convenient stores and grocery stores statewide. Opponents argue that the change would negatively affect the retail liquor stores and cause layoffs and store closings.

OTHER ITEMS OF NOTE

The House is still sinking its teeth into a wide variety of energy policy options, including a bill that would pave the way for the Holcomb coal-fired plants that dominated last year’s legislative session. More legislation is being considered in the House Energy Committee than in nearly any other legislative committee this year.

The House Taxation committee held hearings this week on several bills including H.B. 2048 which is the first sales tax exemption bill for the 2009 session. The All American Beef Battalion, Inc. is asking the Legislature for a sales tax exemption to help in their charge to give soldiers facing deployment overseas, returning soldiers and wounded veterans a Kansas steak dinner. In recent years, the sales tax issue has garnered much attention from the Legislature in their attempts to rein in and overhaul the current system of granting exemptions on a case by case basis. However, the current budget situation as it is will make it a difficult sell even for the most deserving, worthwhile organizations like the All American Beef Battalion.

The committee also held hearings on a bill which would grant the telecommunications industry a sales tax refund on machinery and equipment. A similar bill passed the Legislature last session as a part of the Holcomb coal plant bill, but was eventually vetoed by the Governor. Like other pieces of legislation which have a fiscal note, this sales tax refund has little hope of passage this year.

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