Government & Politics

Brownback tax cuts survive after Kansas House rejects Senate move to dismantle them

Efforts to dismantle Gov. Sam Brownback’s tax cuts started again late Tuesday as a bill that would cut back many of the Kansas Republican’s prized economic policies cleared the Kansas Senate.

The 26-14 vote was the first major income tax bill to pass a chamber in the Kansas Legislature this month after a slew of attempts either fell apart before making it to a floor vote or were pulled before a debate could be held.

But less than a half hour later, the House voted down the bill, 37-85, and stalled the tax increase in its tracks.

The bill climbed to just shy of 60 votes in favor before support fell off when it became clear the legislation was not going to pass the House.

House Majority Leader Don Hineman, a Dighton Republican, refused to comment on the failed tax vote shortly after the bill fell.

The bill’s failure in the House leaves the Legislature with no clear direction on tax policy as it tries to end the 2017 session.

“We’re never leaving,” Rep. Susan Concannon, a Beloit Republican, said shortly after the vote.

In the Senate, lawmakers said earlier that the tax increase they passed would be “enormous,” and one said it may be the largest tax increase in the state’s history. But as Tuesday came to an end, enough Senate Democrats and Republicans were able to agree that it was time to pass a tax plan.

Their counterparts in the House didn’t come to the same consensus.

The legislation the Senate passed was estimated to raise more than $1.2 billion over the next two fiscal years by ending Brownback’s tax exemption for roughly 330,000 business owners and boosting income tax rates.

“It’s a tough vote, we’re in a tough spot,” Senate Majority Leader Jim Denning, an Overland Park Republican, said after noting he was supporting the bill reluctantly.

“This bill’s far from perfect,” Senate Vice President Jeff Longbine, an Emporia Republican, said. “But I’ve never seen a tax plan that was perfect.”

For the most part, Kansas Democrats and conservative Republicans had voted together against a pair of recent income tax increases for differing reasons.

But in the Senate, Democrats joined together with moderate Republicans to pass the latest tax bill over the objections of conservative members of the GOP.

“It is time to wrap up the session,” Sen Tom Holland, a Baldwin City Democrat said after telling lawmakers he’d support the bill.

Conservatives in the Senate tried to throw up road blocks to the legislation and effectively kill the bill.

Those attempts failed.

“It’s going to be a very burdensome tax increase,” Sen. Dennis Pyle, a Hiawatha Republican, said after he fell short of ending the bill’s chances of passing.

A third income tax rate, thrown out by Brownback’s 2012 tax cuts, would have been brought back if the bill had continued to move forward.

Tax rates would have begun to increase during tax year 2017 under the bill.

The increased rates would have been phased in, rising at first to 2.9 percent, 4.9 percent and 5.2 percent.

“I truly believe this is a step in the right direction,” Senate Minority Leader Anthony Hensley, a Topeka Democrat, said.

By tax year 2018, the tax rates would have risen to 3.1 percent for the lowest rate, 5.25 percent for the middle rate and 5.7 for the highest rate.

The Sales Tax and Revenue Bond Financing Act, referred to as STAR bonds, would also have been extended under the proposal for another three years.

Lawmakers are facing budget shortfalls and are working to increase spending for schools in an effort to please the Kansas Supreme Court.

“The reality of it is, we need a massive tax increase to pay for the addition in school finance and to structurally fix our budget,” Longbine said.

Sen. Ty Masterson, an Andover Republican, vented his frustrations about the tax increases and how it would impact the state’s budget during the floor debate.

“I’m at a loss,” he said.

Hunter Woodall: 785-354-1388, @HunterMw