The Lawrence Journal-World, Jan. 20
Stick with budget plan
Before they push hard for tax cuts, Republican legislators would be wise to remember the mistakes that cost the party the governor’s office.
Last week, newly inaugurated Gov. Laura Kelly outlined her proposed budget for the 2020 fiscal year. Kelly pushed for increased public education funding, expanded Medicaid and pay raises for state employees. She proposed refinancing the state’s pension debt over 30 years. Kelly’s $18.4 billion budget is the state’s largest ever.
What Kelly did not include in her budget was income tax relief, a major initiative for Republicans, who control the House and Senate by overwhelming margins. Republicans want to return to residents some of the excess tax revenue that has accumulated since lawmakers overhauled the state’s tax policies.
So far in fiscal year 2019, tax revenue has exceeded 2018 revenues by $195.73 million. And Kelly’s budget projects that the state will have cash reserves of $686 million at the end of the 2020 fiscal year. Kelly’s budget director, Larry Campbell, said the cash reserves were a hedge against an economic downturn.
Campbell is right. Not that long ago - the end of the 2016 fiscal year - Kansas had just $35 million in reserves, the equivalent of enough money to keep the government running for just two days. It was the smallest cash reserve of any state in the nation, according to a Pew Charitable Trusts report.
The fiscal issues were the direct result of tax cuts implemented by Gov. Sam Brownback and conservative legislators in 2012 and 2013. Brownback argued the cuts would stimulate the economy, spurring job growth and consumer spending. Instead, the economy stagnated and the state suffered declines in tax revenues month after month after month.
The cuts became the albatross that dragged down Brownback’s tenure as governor. Legislators finally repealed the tax cuts in 2017, but only after a coalition of Democrats and moderate Republicans voted to override a Brownback veto.
Any notion that Kansans longed to return to the Brownback strategy were put to rest during the 2018 election. Kris Kobach ran on just such a platform, even arguing that Brownback didn’t go far enough. Kobach’s vision wasn’t well received and Kelly, a former state senator, won going away.
The state of Kansas remains under court order to fund K-12 education at a higher level. Lawmakers have plundered the state’s highway funds to pay for other initiatives. Even with the excesses, there remain areas of state government that need more help.
Campbell argued that lawmakers should wait up to three years, allowing tax revenues to stabilize, before implementing new cuts.
Implementing tax cuts now would expose the state budget to significant risk and threaten the economic improvement that has been experienced the past two years. Republican lawmakers would be wise to remember that this debate was the central focus of the 2018 gubernatorial campaign and, in the end, voters chose Kelly’s vision for the state.
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The Kansas City Star, Jan. 16
’A battle royale’: Kansas Gov. Laura Kelly’s first big test will be Medicaid expansion
Kansas Gov. Laura Kelly on Wednesday devoted as much attention to Medicaid expansion as any other issue.
“I’ve made no secret that expanding this program is one of my top priorities,” she said in her first State of the State address.
But no issue, including school funding, will prove to be as big a test for the new governor as this one. Conservative leaders in both the Kansas House and Senate have stacked committees that deal with this issue with anti-expansion lawmakers.
In the House, for instance, Rep. Susan Concannon, a Beloit Republican and an expansion proponent, was set to become chair of the health committee.
Instead, House Speaker Ron Ryckman moved her off the committee entirely, and other Republicans hostile to the program were added. Leaders also have stacked the deck on the Senate side with new rules out Wednesday that will make it tougher to bring up the issue in committee.
Sen. Barbara Bollier, a Mission Hills Democrat who has championed expansion, was asked about the degree of difficulty of passing an expansion bill out of the Senate.
“Nearly impossible,” she said.
On the House side, advocates are calling the upcoming struggle “a battle royale.”
This, then, becomes the first significant leadership challenge of Kelly’s administration. And it is a whopper, even though backers of the program nearly got the measure past a Gov. Sam Brownback veto in 2017. This is a new year with a slightly more conservative Legislature and with leaders determined to crush this effort.
Kelly was straightforward Wednesday about how she’ll proceed. Next week, she plans to announce a bipartisan working group to craft a proposal. By Jan. 29, which happens to be Kansas Day, Kelly vowed that a plan to expand Medicaid will be before the Legislature.
“I can imagine no better way to celebrate our state’s 158th birthday than by embracing a policy that will make every Kansas community healthier, stronger and more secure,” she told lawmakers.
One way to achieve this will be to formulate a plan that is both revenue neutral and Kansas-centric, both of which are said to be goals of the new administration. The Kansas Hospital Association has issued a graphic showing that expansion can actually save the state money to the tune of $5 million in 2020.
When it comes to developing a Kansas-style plan, Democrats already are bracing for a proposal that includes work requirements and maintains the state’s Medicaid program, known as KanCare, as a private system. Those ideas would be tough for Democrats to swallow, but perhaps essential to getting a bill passed.
Polls say most Kansans support Medicaid expansion. Rural Kansas surely would benefit. The state is forfeiting hundreds of millions a year by not expanding. All those arguments have been made.
Now, Kelly must find a path forward.
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