March 28, 2024

Keeping Media and Government Accountable.

Gov. Kelly’s proposals create budget deficit in five years

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A state General Fund budget profile, including Governor Kelly’s $1.2 billion handout to a single company, her other proposals, and the Senate’s version of her food sales tax elimination creates a budget deficit in FY 2027.  Kelly and other legislators heavily criticized Gov. Brownback for something quite similar, but Kelly is facing a tough re-election in November, so a budget deficit is now apparently fine with her.

Reuters is reporting that the subsidy package already approved by the Legislature is expected to go to Panasonic if Kansas is selected for its electric car battery plant.  The Senate Assessment and Taxation Committee is recommending SB 339 for passage but the full Senate has not taken up the issue yet.  Her other proposals are still being debated.

The profile shows revenues declining and expenditures increasing each of the next four years.  FY 2026 would finish with a small ending balance (2.9% of expenditures) that is below the statutorily-required 7.5%, and the pattern produces a significant deficit the following year.

Staffers with the non-partisan Legislative Research Department presented their findings to the Senate Tax Committee last week.

Tax relief for individuals and existing companies is needed, as Kansas has some of the highest effective tax rates in the nation.  But that also means legislators need to spend less, according to Ganon Evans, a policy analyst with Kansas Policy Institute.

“Our 2021 Green Book report shows Kansas spent 42% more per resident in 2019 than states without an income tax.  Providing services at lower costs is what allows some states to tax less, and Kansas has ample opportunity to do so to eliminate the coming budget deficit.”

Kansas Policy Institute owns The Sentinel.

Sen. Caryn Tyson (R-Parker), who chairs the Senate tax committee, says Kansas taxpayers need tax relief.

”The revenue estimates presented to the tax committee this week confirm that legislators need to cut taxes to put more money in taxpayers’ pockets and stop growing government.”

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