Questions abound as Kansas Legislature adjourns

TKansas lawmakers filed out of the Capitol early Saturday after wrapping up the shortest legislative session in 40 years.

They passed a budget, approved more money for courts and schools, mandated insurance coverage for children with autism, canceled out local gun laws and phased out a mortgage registration fee.

Next year’s Legislature may not move so swiftly.

Lawmakers headed home this election year still facing a looming financial crisis amid falling revenues. Courts continue to examine whether Kansas is living up to the state constitution’s insistence on adequate funding for public schools.

While the Legislature and the courts dodged a showdown this year over who decides school spending, the relationship between the two branches of government only got rockier. More tension may lie ahead.

“There is great uncertainty hanging over this Legislature,” said Fort Hays State political scientist Chapman Rackaway.

Lawmakers passed a balanced $14.6 billion budget before adjourning about 2 a.m. However, there are signs that might not be easy next year if tax revenues continue to decline following deep income tax cuts signed into law in 2012 and 2013 by Gov. Sam Brownback, a Republican.

Revenues were $92 million below projections for April, raising the possibility they might be down in the coming months as well. Moody’s Investor Service cut the state’s bond rating, partly because of income tax cuts.

“What’s around the corner?” asked Annie McKay, executive director for the Kansas Center for Economic Growth, a Topeka think tank that focuses on tax and budget issues. “Are they even going to have any money when they come back in 2015 to fund critical state services?”

At the state’s current spending pace, when coupled with declining revenue, the state will burn through nearly $600 million in reserves by 2016, according to projections developed by legislative fiscal analysts.

The state will be left with about $14 million in reserves by 2016 and forced to make $256 million in cuts to balance the budget by 2017.

A separate analysis done at the request of Democrats with different assumptions, projects those budget cuts will start as early as 2016.

“On our current path, it looks disastrous,” said Rep. John Wilson, a Lawrence Democrat. “We’re going to have to cut somewhere or find additional revenue. Obviously, there’s no guarantee that additional revenue is going to happen.”

Conservative backers of the tax cuts believe the policy needs to be given a chance to work. They acknowledge the state could face rough budget times in the short term. But for now, they said, the state has enough of a cushion to get through the next couple of years.

“If revenues don’t grow like we think they will, we’re going to have some difficult decisions,” said state Rep. Marvin Kleeb, an Overland Park Republican and a member of the House Appropriation Committee. “Next year’s going to be challenging unless we have a tremendous increase.”

Kleeb said lawmakers never thought that the tax cut would be a one- or two-year solution to boosting the state’s economy. He said it would take several years for the state to attract new business with the tax cuts.

Other lawmakers see the state’s fiscal health as much more grave. They believe that predictions of big budget holes, made two years ago when the first tax cuts were approved, are coming true.

“We’re in trouble,” said state Rep. Barbara Bollier, a Mission Hills Republican. “We’re going to leave here with a huge debt for whoever the governor is — be it Sam Brownback or (Democratic challenger) Paul Davis. Someone is going to have to dig out.”

Davis has blasted the Brownback tax cuts. But so far Davis has not said if he would try to repeal the cuts if he is elected governor.

Another issue still hanging as lawmakers returned home Saturday is education.

Legislators put $129 million into schools to fix an unconstitutional funding disparity between rich and poor districts.

But whether Kansas is putting enough money into its schools is still being mulled over by the courts, although it unclear when the courts will rule. The Kansas Supreme Court has tossed the issue back to a lower court.

“The fact (lawmakers) put back some of the money is a step in the right direction,” said lawyer Alan Rupe, who represented the districts and families that brought the school funding lawsuit. “There is a long way to go.”

The courts could still order the state to spend more money on education.

“Given the past history, there’s every reason to be concerned,” said Rep. Lance Kinzer, an Olathe Republican who believes that court has overstepped its authority in forcing the Legislature to spend more on schools.

More court-ordered school spending could lead to the showdown with the Legislature that many anticipated this year.

The standoff between the two branches never unfolded because the Supreme Court handed down a tempered ruling that, for now, forced the state to fix a spending disparity between rich and poor schools.

Nevertheless, another court order forcing more school spending could fuel retaliation — a renewed move by lawmakers to rework how members of the high court are chosen.

“Clearly, there remains a lot of anger at the court,” said University of Kansas political scientist Burdett Loomis. “I don’t think we’re finished with that.”

Senate Vice President Jeff King, a Republican from Independence, believes the state will be on solid footing on the question of overall education funding.

He said new standards laid out in the March ruling, emphasizing school performance over school spending, help the state’s case.

“The Legislature is well-suited to prove to the courts that we are adequately funding education to maximize student achievement,” King said.

This story was originally published May 3, 2014 at 7:03 PM with the headline "Questions abound as Kansas Legislature adjourns."