Kansas lawmakers continue to wrestle with the state’s budget challenges. The latest chapter will come Thursday, when the state Senate considers a bill that would close a $280 million budget gap between now and July 1.
The plan calls for borrowing from the state’s investment fund and postponing contributions to the pension fund.
State Senate President Susan Wagle of Wichita wants to do more. Thursday, she plans to propose an across-the-board cut in state spending.
The cuts, most likely 2 percent, would come in addition to the one-time maneuvers involving pension and investment funds.
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“We’re all going to have to cooperate” to cover the state’s budget shortfalls, Wagle told The Star’s editorial board this week.
That’s right, of course, but it won’t make much difference for her plan. Cutting K-12 education by 2 percent this late in the school year would put a serious dent in district budgets and cause problems with other state programs and activities.
Lawmakers on both sides of the aisle said Wednesday they’d find it hard to approve the cuts.
We know tax increases are out of the picture. The money would simply come in too late to help over the next 3 1/2 months.
Taking money from pensions and surplus investment funds is ill-advised. But we also recognize reality: At this late date, those one-time fixes may be the only viable options left.
Once that problem is addressed, though, the Legislature and Gov. Sam Brownback must return to the responsibility of figuring out how to resolve the state’s long-term budget crisis. Fixing that problem will mean more than one-time budget tricks and borrowing.
Raising taxes seems certain. Lawmakers fell just short of approving a $1 billion, two-year tax hike package in February. The so-called LLC exemption, which helps small business owners avoid any state income tax on their earnings, is doomed.
But there’s chatter some Republicans want to consider a flat income tax. A well-designed flat tax, they believe, could help solidify the state’s finances over the next two years.
It’s hard to imagine a worse idea.
A flat tax would set a single rate — say, 4.3 percent. That rate would mean an enormous tax hike for the state’s poorest workers.
A couple with taxable income of $30,000 would pay an additional $480. A couple earning $60,000 would see an increase of $390.
A couple earning $120,000 would pay an extra $210.
Kansas already charges an exorbitant and regressive sales tax, including a sales tax on food. Making the state’s income tax structure more regressive would double down on that disastrous approach.
We think most Kansas lawmakers will scoff at such an idea. The tax package they passed in February actually added a third income tax bracket, returning the tax code to its progressive structure of several years ago.
Taxes should be low, broad and fair. Kansas misses badly on all three standards.
The fix for the state’s budget hole must be fair to all the state’s residents, and a flat tax doesn’t come close.