Government & Politics

Kansas delays contribution to state employee pension system

Shawn Sullivan, Kansas Gov. Sam Brownback’s budget director said the state is delaying contributions to the Kansas Public Employees Retirement System until new state revenue numbers are provided.
Shawn Sullivan, Kansas Gov. Sam Brownback’s budget director said the state is delaying contributions to the Kansas Public Employees Retirement System until new state revenue numbers are provided. The Associated Press

Kansas is delaying an April contribution of $92.6 million to its state pension system, a move that could be used to help balance the current budget.

The delay does not affect current retirees’ benefits in the program, the Kansas Public Employees Retirement System, said Shawn Sullivan, budget director for Gov. Sam Brownback.

“No decision has been made as to whether this will be used as a budget-balancing tool for this fiscal year,” Sullivan said, “but this action allows us to maintain the flexibility provided by the Legislature through the budget bill as we wait for the Consensus Revenue Estimating Group to provide new revenue numbers later this month.”

If the Brownback administration chooses not to make the retirement system contribution this fiscal year, the payment would have to be paid with 8 percent interest by Sept. 30. That provision was included in this year’s budget bill to try to avoid damage to the pension system.

Brownback spokeswoman Eileen Hawley said it’s not yet clear how long the contributions will be delayed. It’s possible, she said, that it might not be more than a few weeks.

The Consensus Revenue Estimating Group, a panel of economists and officials, will meet April 20 to adjust revenue projections for the remainder of the fiscal year and for the 2017 fiscal year, which begins July 1.

Since the fiscal year began, the state’s month-to-month tax collections have fallen a total of $81 million short of expectations, a shortfall of 1.9 percent. The state has missed its projections 11 of the past 12 months.

This year’s budget bill provided only a small ending balance for the 2016 fiscal year, which closes June 30. But with the shortfalls in monthly tax receipts, the current budget is in the hole by about $31 million.

If the administration doesn’t make the retirement system contribution this fiscal year, it could avoid a deficit but also create problems for the beginning of the 2017 fiscal year.

“It kicks the can down the road 90 days and gives the governor the chance to see what the revenue estimators come up with,” said Sen. Jim Denning, an Overland Park Republican and member of the Senate Ways and Means Committee.

Brownback’s office said that the administration has significantly increased the state’s contributions to the retirement system. The average yearly general fund contribution from 2012 to 2015 during Brownback’s administration was $388 million. It was $181 million a year from 2001 to 2010.

The Associated Press contributed to this report.

Edward M. Eveld: 816-234-4442, @EEveld

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