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May 8th Legislative Update
This session we have been faced with one of the worse economic downturns in our state's history. As you know, the Kansas Legislature worked diligently earlier this session to carefully reduce state spending. Legislators made many difficult decisions regarding how we should balance the state's budget. We asked every state agency to share in the pain, admittedly, some more than others. Unfortunately, the state’s economy continues to worsen and those efforts were not enough. We learned a few weeks ago we must make at least another $328 million in budget adjustments.
Budget
The Legislature finalized what’s known as the Omnibus budget bill this week. With the budget shortfall, our remaining options were either more spending cuts or raise your taxes; neither was a pleasant idea. The Senate passed its version but spends about $61 million more than expected revenues. On a motion to agree to the Senate’s plan, the House voted 64-60 to accept the Senate’s Omnibus budget. The bill reduces state spending by $154.5 million and adjusts revenues upward by $122.3 million:
- Makes a 2.75% across-the-board cut in FY 2010 to all agencies except debt service and human services caseloads. That cut will reduce K-12 Education by $83.7 million and reduce Higher Education by $22.1 million.
- Adds $20 million for disaster relief;
- Adds $7.8 million to school finance to replace lower local property tax valuations;
- Deletes requirement of agencies to provide a 1% pay increase to employees;
- Authorizes $38.0 million in bonds for Statehouse renovations;
- Stops the 2nd payment ($25 million) of the 2009 Slider payment to local units of government;
- Assumes $50 million in expanding gaming receipts;
- Transfer $17.4 million from special revenue funds to the State General Fund (SGF);
- Shifts $5 million Special City/County Highway Fund payment from SGF to State Highway Fund
- Sweeps $4.2 million from Kansas Savings Incentive Program to SGF;
- Transfers $25.1 million from Highway Fund to SGF for highway bond payments.
As I write this, the Legislature is still working on a tax package to fill the $61 million gap to balance the state’s budget.
Legislature Passes Comprehensive Energy Plan
The Kansas Legislature once again passed a Comprehensive Energy Plan but this time the Governor is committed to sign it into law. The bill will:
- Direct the KDHE to establish emissions standards that are no more stringent, restrictive or expansive than those required under the Federal Clean Air Act.
- Clarify the KDHE Secretary use of emergency powers
- Allow Kansas Electric Transmission Authority (KETA) to assist in the building of transmission lines that would serve small and local communities.
- Set State Energy Efficiency Standards.
- Require energy companies get at least 20% of their electricity from renewable energy sources by 2020.
- Establish Net Metering
- Require new coal-fired plants to purchase at least 5% of its coal supply from Kansas coal mines provided it is competitively priced.
Sunflower Electric reached a settlement earlier this week with the new governor to build a new coal plant near Holcomb. The compromise allows the electric coop to build one 895 megawatt plant instead of the original request to build two plants. Among its commitments, Sunflower also will build 179 Megawatts of wind energy facilities; develop two 345 Kilovolts transmission lines to meet the western energy grid; and develop a bio-digester to capture methane and an algae reactor. All of these are part of Sunflower’s original plan that you can read more about at http://www.holcombstation.coop/.
This is great news for our state because it means new 1500 construction jobs and hundreds of permanent jobs plus re-establishes regulatory certainty and fairness in Kansas.
New Governor
Speaking of Governor Mark Parkinson, he became our state’s 45th governor last Tuesday when Governor Kathleen Sebelius was sworn in as the country’s Health and Human Services Secretary.
While it is early in his tenure, Governor Parkinson seems to be more accessible to the Legislative Leaders and also more willing to work with us. Last Thursday, he addressed a joint session of the Legislature. He talked about how handling the state’s current recession correctly could have a positive impact on our state 20 years from now.
He also said balancing the state budget would take not only additional budget cuts but also what he called “revenue enhancements” that include delaying the phase out of the franchise tax on businesses and the estate tax on grieving families; decoupling from the federal tax code; adding future gaming revenue to the state’s bottom line; and offering amnesty to those who owe back taxes to the state.
In the meantime, I hope you will join me in wishing former Governor Sebelius well as she begins her new role. We didn’t always agree on the issues but this is a great opportunity for Kansas.
Session Wrap-up
We adjourned shortly before 3:00 a.m. early Saturday morning. Budget calculations came in and all numbers were crunched. Everything was figured in a positive light so it now depends on the economy and its effect on the budget. Tough budget times probably aren’t over yet and Governor Parkinson may likely need to make further cuts if necessary.
As always, it is an honor to serve as your State Representative. My Topeka office is now closed. You can reach me as follows:
Email: vickrey@jenevickrey.org
Phone: 913-837-2585
U.S. Mail:
502 S. Countryside Dr
Louisburg 66053
Sincerely,
Jene Vickrey