A special thank you goes out to everyone who took the time to send in the recent survey. It’s a wonderful aid to me in my legislative work. If there’s anything I can do to help you, please call or e-mail me.

Office phone: 785.296.6014

E-mail: vickrey@jenevickrey.org

Streamline Sales Tax

The House passed House Bill 2599 (HB 2599) by a vote of 95 to 29 on Wednesday, March 9, 2003. This measure postpones the implementation of the streamline sales tax until Congress passes legislation requiring states to enact such a tax.

During the 2003 Legislative Session, the Streamline Sales Tax was passed requiring merchants to pay the sales tax rate of the taxing jurisdiction where their goods are delivered. This destination style tax was put into effect with the purpose of forcing internet companies to pay sales tax when delivering goods in Kansas.

Although streamline sales tax was passed with good intentions, and with strong support of the state chamber and the National Federation of Small Business (NFIB), it unfortunately had unintended consequences. The problem arises when merchants try to figure out what the tax rate is for a specific location. Kansas has 751 taxing jurisdictions, and the tax rate can change drastically when you go from the county to a city.

As a result, the streamline tax overwhelmingly has an adverse affect on small business. They have difficulty putting an accounting system in place that can adequately calculate the sales tax. It also costs businesses by having them spend numerous hours a week filling out and sending in tax forms to the Department of Revenue.

I also strongly support two amendments that would help our businesses in Miami Co. The first amendment will give businesses with less than $20,000.00 a year in state sales tax liability the opportunity to qualify for a $1,000.00 tax credit. This can be used to offset the cost of the purchase of the necessary software whenever the streamline sales tax is enforced. The second amendment would pay our businesses for the work of collecting sales tax for the state.

Passing HB 2599 would help small businesses to deal with the difficulty of implementing streamline sales tax. They did not believe the amount of funds the state would receive from the tax would ever justify the cost of collecting it. House Bill 2599 now heads over to the Senate to face an uncertain fate.

Earlier this year the Senate voted on different measures that would kill the streamline sales tax, place a moratorium on the tax, and that would make it so that small businesses would not have to comply with the collection of the tax. All of these measures failed.

 

Alternative Education Plan

Last week, House Bill 2807, commonly referred to as the Rooney Plan, and that some have nicknamed "The Johnson County Plan," was defeated on the House Floor. This bill was an alternative to the current school finance formula that is being challenge in the courts.

Instead of having a complicated formula that has different weighting factors to help districts offset costs, the Rooney Plan attempted to simplify school finance. The formula would have created an equalizing effect among wealthier and poorer school districts by subsidizing the amount of revenue school districts generate from mil levies.

The state would have looked at the statewide assessed property valuation per pupil. It would have then subsidized a district’s ability to generate revenue so it is equivalent to the 95^{th percentile of assessed value per pupil. Any district that had an assessed valuation per pupil above the 95th percentile would not have received any aid, but any district below that level would have received a portion of state aid so it is equal to the 95th percentile. - The Appropriations Committee is on track to pass out the budget next week. - The committee will be busy working four bills. 1) Creating a sentence of life without parole as an option to the death penalty. 2) Allowing private prisons to be operated in Kansas. 3) Addressing problems in the criminal justice system when dealing with those with mental illness. 4) Addressing limitations on the implementation of the death penalty for the mentally retarded. - The State of Kansas has been approached by Lego Land about the possibility of constructing one of their amusement parks for children in the Kansas City area. Lego Land has three child-oriented amusement parks in the world. Each site is focused on science and construction. - A school choice bill will be before the committee next week. - Now that the Senate has passed a bill which would allow for the transfer of campaign funds from a House member’s account to that person’s Senate race account, the committee will hold hearings on whether the House should also approve such a measure. - Persistence pays off. Even though a previous bill failed to pass out of committee earlier this session, the committee finally voted a Dram Shop bill out of committee. This bill would make places that sell alcohol liable for selling alcohol to a person that later drives drunk and causes an accident. - A bill making the results of how a Republican Representative votes for party leadership open to the public was passed out of committee. Currently, when a party’s leadership is chosen, the ballots are cast in secret, so someone can say they voted for one candidate but actually voted for another. - The chair received a letter from Governor Sebelius claiming that the committees efforts to pass a bill limiting liability for the Agritourism industry were futile, because she vetoed similar legislation last year. She contends that Agritourism attractions should protect themselves and take out insurance. However, as the former Insurance Commissioner knows, there is not an insurance company in Kansas that will insure such ventures. Some businesses have to look for insurance carriers that are located out of the country to meet their needs. - The committee will start working on a Senate Bill that would increase the speed limit on four-lane highways from 70 mph to 75 mph. In addition, it would give drivers caught for speeding in a 75 mph zone a five mile per hour window before making the infraction a moving violation that would be reported to your insurance. Currently, someone caught for speeding in a 70 mph zone has a 10 mph buffer before the ticket is reported.}

If a school district would have experienced increased enrollment, the assessed valuation per pupil would have gone down, so the gap between their fund raising ability and the 95th percentile would have widened. As the gap widened, the state would have been required to pay a larger share so they were equivalent to the 95th percentile. If a school district experienced a decline in enrollment, the assessed valuation would have increased, so the state would have paid less.

The Rooney Plan guaranteed school districts they would have received the same funding they currently get from the state under the current formula. After the first year of implementation, schools would be allowed to raise their local taxes to accommodate their specific needs. However, if multiple districts raise local taxes and the state does not have the funds necessary to finance all of the increases, the school districts would only receive a proportional increase depending on how much funding is available.

Several problems in the bill are exposed:

Although the school finance debate is not fully resolved, it did illustrate the difficulty the legislature faces when dealing with a school finance formula. Redrafting a school finance formula is a huge undertaking that must be as inclusive as possible to meet the needs of a very diverse state.

 

House to Consider Entrepreneurial Initiative

Senate Bill 393 (SB 393) passed out of the House Economic Development Committee on Wednesday. SB 393 is the second part of the Kansas Economic Growth Act (KEGA) which is referred to as the Kansas Entrepreneurial Initiative. The first part of KEGA, the Kansas Bioscience Initiative, was passed out of the House earlier this session in House Bill 2647.

Entrepreneurial Initiative tries to capitalize on job creation by developing an economic environment that is friendly to new businesses. In order to accomplish this, SB 393 would establish the Kansas Center for Entrepreneurship.

The Center for Entrepreneurship would provide grants to local and regional community economic development agencies who would then disperse funds to individuals trying to start a new business. Those who receive funding from the center would first have to be approved through an application process. Some funds provided by the Entrepreneurial Initiative will be specifically allocated to redevelop downtown areas.

The Center would also provide support services for current business owners and those who wish to start a new business. The services would include a toll free number that owners could call to get advice on how to receive financial backing or regarding better ways to manage their businesses.

The Kansas Entrepreneurial Initiative will require $3.5 million over 10 years to cover the operating costs for the Center and the initial investment for grant funds. This is a minimal investment in a program that will create thousands of jobs for Kansans. In fact, KEGA has been declared my many Representatives as being the most important piece of legislation before the legislature this year because of its potential to make a lasting impact on Kansas’ economy.

Committee Reports

Appropriations

- The Appropriations Committee is on track to pass out the budget next week.

Corrections and Juvenile Justice

- The committee will be busy working four bills. 1) Creating a sentence of life without parole as an option to the death penalty. 2) Allowing private prisons to be operated in Kansas. 3) Addressing problems in the criminal justice system when dealing with those with mental illness. 4) Addressing limitations on the implementation of the death penalty for the mentally retarded.

Economic Development

- The State of Kansas has been approached by Lego Land about the possibility of constructing one of their amusement parks for children in the Kansas City area. Lego Land has three child-oriented amusement parks in the world. Each site is focused on science and construction.

Education

- A school choice bill will be before the committee next week.

Elections

- Now that the Senate has passed a bill which would allow for the transfer of campaign funds from a House member’s account to that person’s Senate race account, the committee will hold hearings on whether the House should also approve such a measure.

Judiciary

- Persistence pays off. Even though a previous bill failed to pass out of committee earlier this session, the committee finally voted a Dram Shop bill out of committee. This bill would make places that sell alcohol liable for selling alcohol to a person that later drives drunk and causes an accident.

Rules and Journal

- A bill making the results of how a Republican Representative votes for party leadership open to the public was passed out of committee. Currently, when a party’s leadership is chosen, the ballots are cast in secret, so someone can say they voted for one candidate but actually voted for another.

Tourism and Parks

- The chair received a letter from Governor Sebelius claiming that the committees efforts to pass a bill limiting liability for the Agritourism industry were futile, because she vetoed similar legislation last year. She contends that Agritourism attractions should protect themselves and take out insurance. However, as the former Insurance Commissioner knows, there is not an insurance company in Kansas that will insure such ventures. Some businesses have to look for insurance carriers that are located out of the country to meet their needs.

Transportation

- The committee will start working on a Senate Bill that would increase the speed limit on four-lane highways from 70 mph to 75 mph. In addition, it would give drivers caught for speeding in a 75 mph zone a five mile per hour window before making the infraction a moving violation that would be reported to your insurance. Currently, someone caught for speeding in a 70 mph zone has a 10 mph buffer before the ticket is reported.