- Last year Kansas shattered the state's previous record for job creation in a single year by adding 16,000 jobs to the private sector industry.
- Education Weekly ranked Kansas in the top 20 for education spending per student.
- Nationally, states' budgets average 35.3% directed at education funding. In Kansas, we spend dramatically more, at 62 percent.
- Base state aid per pupil (BSAPP) is commonly referred to in press accounts as a benchmark for education funding. While it sits at $ 3,838 and the court has asked for $4,492, the reality is the state is already spending $12,378 per student when accounting for total funding.
- Only 54-cents of every dollar spent on education funding is going into the classroom.Our state's agenda is quickly filling up. Issues we are considering include a change in how we select judges; education finance reform; lowering state income tax rates; and further balancing the budget.
In the first few weeks, time will be spent in committees reviewing new policies and beginning the process of determining which legislation will be the primary focus of the session. As the session progresses, activity will transition from the committee level to floor debates and final votes. Throughout this process, I will continue to keep you updated as we work together to represent our shared interest. I encourage you to contact me. It's always fun to have visitors in the building and you're welcome anytime we're in session. I am in Room 135 E. Please call ahead and let us know you are coming so we can work the schedule - call (800) 432-3924 and leave a message, we'll get back to you.
State of the State Address
Recently, Governor Brownback gave his annual State of the State address. The Governor remains committed to moving our state forward by continuing the job creation and economic growth we're already experienced during his first two years in office. The Governor introduced a major innovation for our budgeting process by announcing his preference for a two-year budget. The budget protects core services, supports the key goals of his administration, and holds overall spending flat through the end of FY15. Included in the Governor's budget proposal is an increase to total state funding for K-12 education, and maintaining current levels of funding for Base State Aid Per Pupil.The Governor also addressed Kansas' current process for selecting appellate judges, noting it does not reflect the democratic process. He believes taxpayers and citizens deserve some measure of input in their selection. Last year, the Kansas Legislature passed the state's largest tax cut in history. This year Governor Brownback has encouraged the legislature to continue working towards the elimination of the state income tax for all Kansans. The Governor's plan keeps the sales tax flat and lowers the bottom rate for working families to 1.9 percent, and the top income tax rate to 3.5 percent. Our state has worked to create more government efficiencies and assist in streamlining duplicate services in state offices. Now, Governor Brownback has encouraged the Kansas Legislature to merge the Kansas Turnpike Authority with the Kansas Department of Transportation in order to further reduce the size of state government and return the authority, now exercised by the KTA Board, to the elected representatives of the people of Kansas.
Page 2 of 5 - Another major initiative for reform dealt with education. According to 2011 National Assessment of Educational Progress (NAEP) test scores, 29 percent of Kansas fourth graders are reading below the "basic" level. Governor Brownback proposed a statewide retention policy for third graders who are unable to read at grade level, funding to support district level literacy prevention and intervention programs for young children, and an incentive program for schools that achieve significant improvement in student achievement in fourth grade reading.
Governor Brownback discussed a number of challenges that face our state and gave meaningful ways to continue promoting our state's successes. In the coming months we anticipate a healthy debate which focuses on growing jobs and growing our state. A New Era of Fiscal Responsibility in the Kansas Legislature
One of the first pieces of Legislation voted on by the Senate this week was the Joint Rules which now include a new rule, commonly known as PayGo. It requires any amendment to an appropriations bill to be cost neutral. If a legislator, in either chamber, proposes an amendment that requires additional spending, their amendment must also include a way to pay for that specific expenditure. This eliminates the ability for members to propose new spending measures without a viable funding mechanism. I believe this will have a positive impact on the way we create our state budget. State Budget
The Governor's budget proposal fully funds essential state services while keeping State General Fund (SGF) expenditures neutral the next two years and allows for a 7.5% ending balance. The budget proposal also aims to follow-up last year's tax cut by ratcheting down income tax rates even further by moving the bottom bracket from 3 percent to 2.5 percent in 2014 and then again in 2016 to 1.9 percent. Additionally, the top rate is also scheduled to decrease in 2017 from its current rate of 4.9 percent to 3.5 percent.
Among many other things the proposal would:
- Fund the current per-pupil aid at $3,838 in FY2013 and $3,852 in FY2014.
- Provide $5 million to subsidize low-cost airlines using highway money instead of economic development funds.
- Save $15 million by having the Kansas Department of Transportation take over daily operations of the Kansas Turnpike Authority.
As a member of the Senate Ways and Means Committee I am very concerned that we in fact do meet all of our financial obligations without having to raise any taxes - and without shifting taxes to the local level. Success in this depends on economic growth in Kansas. Senate Opens Hearings On Judicial Selection (SCR 1601) One of the key issues taken up by the Kansas Senate is the process used to select judges on the Kansas Court of Appeals and Kansas Supreme Court, commonly referred to as judicial selection. Judicial selection has long been the topic of discussion and deliberation by the legislature, fueled by concerns the current system is undemocratic. Kansas is the only state that currently allows attorneys to have a majority role in selecting judges. Currently, a small minority of 10,000 Kansans, attorneys who are members of the Kansas bar, control the nominating process for the Kansas Court of Appeals and the Kansas Supreme Court.
- Eliminate the state home mortgage deduction while keeping in place the deduction for charitable contributions and the earned income tax credit.
Page 3 of 5 - Senate Concurrent Resolution 1601 addresses this issue through a solution adopted over 200 years ago by our Founding Fathers. SCR 1601 would amend Article 3 of the Kansas Constitution to allow the gubernatorial appointment and senate confirmation of Kansas Supreme Court justices and Kansas Court of Appeals judges. This modified version of the system enshrined in the United States Constitution provides that, once the governor nominates a prospective judge, the Kansas Senate would have to confirm the nominee before they could take the bench. This approach mirrors the process used in Kansas for hundreds of other non-judicial appointees by the Governor.
State Income Tax Reduction During the 2012 legislative session, Kansas passed a historic income sales tax bill which reduces our state's personal and corporate income tax rates. As mentioned above, there are now two brackets which have lower rates and small business owners will also see a reduction in their income tax rates as certain non-wage business income is now exempted from individual income tax. This is the income typically reported by partnerships, limited liability corporations (LLCs), subchapter-S corporations, and sole proprietorships.
Kansas still offers a number of different tax deductions and credits. The standard tax deduction amount for head-of-household filers and married taxpayers filing jointly is $9,000. The standard tax deduction amount for single filers and married taxpayers filing separately is $3,000. This is a 100 percent increase for head-of-household filers and a 50 percent increase for married filers compared to 2012. Two thirds of Kansas taxpayers use the standard deduction.
Also, Kansas tax filers who file as head of household (unmarried with at least one dependent) are allowed an additional exemption of $2,250.
The tax credits still available are to those filers who are paying taxes to other states, rural opportunity zone (ROZ) credit, available from 2012-2016. ROZ's is a credit for 100 percent of Kansas tax liability that is available for nonresidents who established residency in one of the 50 designated ROZ counties. Also available is the Earned income tax credit (EITC). Kansas provides a state credit on top of the federal EITC. The state EITC is 18 percent of the credit claimed on the federal tax return. This is a refundable credit, meaning the qualifying tax filer receives a cash payment for the credit even if no state income taxes are due or paid.
This year, the Legislature will concentrate on further lowering our state's income tax and allow for some technical changes to the current plan. Any changes to our new formula will not come without serious discussion and further study to ensure. Feedback from all angles is a critical part of this process. I encourage you to involve yourself in the process and express your views.
Page 4 of 5 - Education
Education funding is a responsibility of state government. Nationally, states' budgets average 35.3 percent toward education funding. In Kansas, we spend dramatically higher, at 62 percent. We not only spend a significantly larger amount on education than most states, but the current education formula is incredibly complicated and relies on several factors that are constantly in flux. In fact, only a handful of individuals in the entire state understand the current formula.
The solution to our education funding formula is to develop a plan that will help our Kansas schools achieve higher student performance with an emphasis on student-focused reforms. The ambiguities in the law are serving neither our state nor the students. This session we will take a hard, innovative look at Kansas' schools and bring forward different ideas that are focused on the best interest of the student. Money is not the only aspect of this formula; student success should be the main outcome of solving our education funding challenges.
Gannon v. State Court Ruling
Last Friday the Third District Court of Shawnee County ruled that our current system, although in the top 20 for funding education in the nation, is not suitably funded. They ordered an increase to Base State Aid Per Pupil (BSAPP), which is one aspect in the school funding formula. In FY 2013, K - 12 education spending was $12,768 per student. Under the state constitution, the legislature has the sole responsibility to appropriate funds. With this decision, the judicial panel ignored the traditional system of checks and balances and imposed a nearly $597 million tax increase on the people of Kansas.
Education finance funding reform is one of the top priorities of the Kansas Legislature. We will work this year to ensure student achievement is one of the top priorities along with providing necessary funding for education so our schools are operating in the best interest of our children.
State Revenue Update: January Returns
Total State General Fund receipts through December for FY 2013 were $88 million (3.0 percent) above FY 2012 for the same period. Tax only receipts were also above the FY 2012 average by $181.2 million (6.2 percent). 2013 Session Dates and Deadlines The following are some near term dates for the 2013 legislative session.
There are a number of proposals that are being drafted in to bill form. These address protection of Kansans' second amendment rights in several ways, opposition to Obamacare, establishing term limits for legislators (I have asked to be a co-sponsor), protecting the integrity of the bidding process for building and renovations, and supporting a balanced budget amendment for the federal government.
- Mon. February 4 Last day for members to request bill drafts
- Mon. February 11 Last day for non-exempt committees to request bill drafts
- Wed. February 13 Last day for bill introductions by members
Page 5 of 5 - Although early, policy proposals on the above issues, and many others, are quickly forming and I believe it is an important part of the process to keep my constituents updated. As you know, the devil is in the details and many components of these policies are subject to change. I encourage you to let me know your thoughts on the issues discussed by the legislature and others which might be of interest to you. Please feel free to call or e-mail and I'd be happy to discuss any topic you are interested in.