Absent tax hikes, Kansas would cut aid to schools and other spending

Ten school districts in Johnson and Wyandotte counties would lose more than $44.6 million in funding if the state is forced to slash its budget to cover a revenue shortfall, figures released Tuesday show.

Kansas lawmakers have failed so far to find a formula of tax increases and budget cuts needed to cover an estimated $350 million to $400 million budget shortfall.

House and Senate negotiators had planned to meet Tuesday morning in hopes of hashing out a deal. That meeting first was postponed, then just never happened. It’s unclear whether the House will even debate a tax hike bill passed by the Senate last weekend. Meantime, Senate leaders warned on Tuesday that they couldn’t picture passing an alternative.

If the search for more revenue continues to dead-end, state budget officials have said Gov. Sam Brownback might have to cut spending across the board to make up the difference.

Figures released Tuesday give a sense of what a no-new-taxes budget might mean for prisons, universities, road repair and social service agencies focused on the poor and the elderly.

And they gave clarity to what that would spell for various school districts.

The Kansas City, Kan., district would suffer the largest blow in the metro area, losing almost $10.8 million. Olathe is next, facing a $10.3 million cut.

“It’s devastating,” said David Smith, chief of staff for the Kansas City, Kan., district. “We can’t even get our heads around what that would mean.”

Olathe superintendent Marlin Berry said his district’s budget year begins July 1.

“The thought of trying trim out another 10 million dollars is almost overwhelming,” he said. “It’s not a pretty story.”

The Shawnee Mission district would lose $8.3 million, and Blue Valley $6.1 million.

“We would have to take a look at hiring freezes and using our reserves,” said Mike Slagle, assistant superintendent in the Blue Valley district. “That is a lot of money.”

Budget director Shawn Sullivan told 27 House members at a private meeting Monday evening that if the Legislature fails to pass a package of tax increases, a 6.2 percent across the board spending cut would be needed. That would mean a $197 million cut to public schools, which take up about half of the state’s budget.

Wichita, the state’s largest district, takes a $22 million hit.

“It’s a big number,” said Diane Gjerstad, who handles government relations for the district. “That would be extremely serious… We would have to look at the entire operations of the school district.”

“That is a substantial amount of money to try to reduce out of budgets in a couple of months,” Gjerstad said, noting that the Legislature already passed a bill that cut funding from previously announced levels for the current school year and largely kept it flat for the next two years.

A tax plan approved by the Senate on Sunday would fill the budget hole. But it also includes several policy provisions that have drawn criticism, including public dollars for private school scholarships and restrictions on property tax increases by county and city governments.

The bill also largely protects a business tax exemption. Brownback has said he will veto any plan that rolls back a 2012 law that eliminated income tax for certain business owners, one of his signature policies.

House members had scheduled a debate on the bill Monday, but canceled that.

Asked Tuesday morning if he thought that the House could find 63 votes — the minimum needed for passage — to support the Senate plan, House Speaker Ray Merrick, a Stilwell Republican, smiled and replied, “We’re working on it.”

But Tuesday evening House Majority Leader Jene Vickrey, a Louisburg Republican, said that the House would instead craft its own plan. Both plans would include an increase to the sales tax and the elimination of most income tax deductions. Vickrey said House leaders were trying to build consensus before moving forward with a vote.

“We can’t push this too fast … We need everyone to be pulling this wagon together,” he said.

Rep. Mark Hutton, a Wichita Republican and one of the GOP holdouts who attended Monday evening’s meeting, said House members were being pressured to support the tax plan despite their concerns about some of its policies.

“Does it cause me to pause? Of course it does. This is gutting Kansas for political gain,” said Hutton, who has repeatedly called for business owners to be put back on income tax rolls. “Am I going to let somebody float by in the river drowning?

“They’re expecting us to cave because we care. … We care more about our citizens. And we don’t want to see them hurt in the short term.”

The governor’s office refused to respond to Hutton’s comments.

Eileen Hawley, the governor’s spokeswoman, offered some details on the timeline if the state does proceed with the automatic budget cuts, known as allotments.

“If we get to a point where we have a budget that is not fully funded by a tax package and projections are below zero, the Governor would have to send out allotment notifications,” she said. “There is a 30-day period between announcement of an allotment and when any allotment would become effective.”

The Kansas Board of Regents says the state’s higher education system would lose $48 million from potential spending cuts if legislators do not increase taxes.

Regents spokeswoman Breeze Richardson said Tuesday that the board and universities face difficult conversations about priorities if the cuts occur.

University of Kansas spokesman Tim Caboni said its Lawrence campus would lose $8.3 million and its Medical Center in Kansas City, Kan., would lose $6.7 million, for a total of $15 million.

This story was originally published June 9, 2015 at 4:03 PM with the headline "Absent tax hikes, Kansas would cut aid to schools and other spending."