The depth of the hole that the state of Kansas has dug itself into has just become more clear.
Newly elected lawmakers will have to figure out how to cut an additional $287.7 million from the budget before June 30 of next year. In the year after that, they’ll have to cut an additional $435.7 million.
And the Kansas economy is expected to lag behind nationwide growth in the coming year.
A group of legislative researchers, analysts from Gov. Sam Brownback’s budget office, Department of Revenue officials and university economists disclosed Monday that the state has overestimated the amount of revenue it will receive this year by more than $206 million. In order to meet their constitutional obligation to balance the budget, legislators will have to start cutting as soon as they return to Topeka.
That will be painful. For all of the bluster by some lawmakers and conservative groups, Kansas does not have a spending problem. Whatever bad habits the state may have had in that regard were cured by the 2008 Great Recession. Nearly every aspect of government was cut back to the essentials.
Other states began restoring essential services when revenues began to rebound in recent years, but Kansas, urged on by Gov. Sam Brownback, opted for deep income tax cuts instead. Partners and owners of thousands of businesses structured as “pass-through” entity stopped paying income taxes altogether.
The result was supposed to have been economic growth, but instead it has been tumbling revenues. They dropped from $6.4 billion for the 2012 budget year, before the tax cuts took effect, to $5.6 billion last year. This year’s revenues are running only slightly ahead of a year ago, and the new estimate forecasts growth of only 0.7 percent growth next year, partly because more tax cuts are scheduled to take effect.
These revenue projections, and the cuts they foreshadow, will change the face of Kansas.
The $287 million required to balance this year’s budget cannot be found through “efficiencies,” as state budget director Shawn Sullivan told reporters today.
The state already is raiding its transportation fund and using gambling revenues to pay teacher pensions. It has shaken out every pocket and used every trick.
The Legislature in April complied with a court order and added $129 million to its education funding formula to address disparities among school districts. But it agonized over where to find the money, and ended up taking money from other school funding accounts and also taking a chunk of cash intended for the University of Kansas to help fund a new medical school building.
Now lawmakers will have to find double that amount, and even more for the next fiscal year.
That will almost surely mean cuts to elementary and secondary education, rising college tuition, less money for corrections and integrating prisoners into society after release, cuts in social services and possible changes to the Medicaid formula.
It’s small wonder that Brownback ducked the subject of the state’s fiscal status in his campaign, preferring instead to focus on a Kansas Supreme Court ruling in a criminal case and link his Democratic opponent, Paul Davis, to President Barack Obama.
But the voters have made their choice. Brownback owns this fiscal ditch and Kansans will have to live with the cuts. The governor and his supply-side supporters don’t like to acknowledge this, but cutting government too deeply harms a state’s economy. People lose jobs and spending power. That’s partly why forecasters envision anemic growth for Kansas for at least another year.
Sullivan told reporters the administration has no plans to roll back any of the income tax cuts. “The state of Kansas must continue to live within its means just as families do every day,” he said.
Well, most Kansas families are smart enough not to gamble their futures away on untested schemes when the bills are piling up. Their government’s failure to show the same good sense is looking more and more like a tragedy.
To reach Barbara Shelly, call 816-234-4594 or send email to email@example.com. On Twitter @bshelly.