The Kansas legislative session drones on without a tax plan in sight, and who better to blame at this point than President Barack Obama?
Yes, Susan Wagle, the Senate president, went there.
The Republican senator from Wichita was presiding over a debate on Wednesday when she decided she’d heard enough from Democrats and even some Republicans who trashed the income tax cuts the Legislature passed in 2012.
Perhaps people have forgotten, Wagle said, that Kansans voted mostly Republican last November, re-electing the governor and many of the legislators who enacted the steep tax cuts.
“We wanted to devise a fairer, flatter tax system that would grow our economy,” Wagle said. “And people like what we’re doing.”
If the growth strategy is a little slow on the uptake, that has to do with Obama’s policies in Washington and the federal deficit and regulatory uncertainties, Wagle said.
“As soon as we can have a predictable environment at the federal level, economics are going to grow.”
But some state economies already are growing, and Kansas isn’t keeping pace. The latest Bureau of Labor Statistics report showed Kansas trailing 44 other states and the District of Columbia in its rate of total nonfarm job creation so far this year.
Wagle has a point about uncertainty. It’s not good for job growth or much of anything.
But the biggest driver of uncertainty in Kansas is the budget-busting tax cuts that Wagle feels compelled to defend. Instead of jump-starting the economy, as promised, they have created an $800 million deficit in next year’s state budget. Borrowing and other tricks will make up about half of that difference, and lawmakers are trying to figure out how to find the remaining $400 million.
So right now, nothing is certain.
While most Kansans received a small reduction on their income taxes as a result of the 2012 law, owners of certain types of businesses were exempted from paying any state tax on their income. Even Wagle acknowledges this was “a hiccup,” enabling more people to avoid paying taxes than lawmakers had anticipated.
Like it or not, those business owners should be prepared to pay at least some income taxes in the coming year. The exemptions are controversial and it’s hard to envision a tax plan that doesn’t roll them back.
Pardon the uncertainty, all you folks cast in the role of job creators. But, hey, welcome to the club. There’s nothing like horrible state fiscal policy to create a state of flux.
Parents in some school districts around Kansas were caught off guard when their schools ran out of money and ended the school year earlier than scheduled. That’s a couple of weeks of child care families hadn’t counted on.
Low-income families, who already have lost tax credits that helped them offset the costs of rent, child care and groceries, fear the Legislature might end or reduce the state’s earned-income tax credit, which put some essential cash in the hands of 220,000 Kansas households last year.
City and county governments exist in perpetual uncertainty, never knowing when a legislative decision might deprive them of yet another source of revenue.
In budget debates in Topeka over the last few weeks, lawmakers have expressed a great deal of concern about creating uncertainty for business owners, while saying little about ordinary citizens.
Kansans may not be as pleased with the Legislature as Wagle thinks they are if their purchases become more costly and their property taxes go up — likely outcomes of the budget-balancing exercise.
Kansas finances are in a home-grown mess that has almost nothing to do with Washington. The Legislature must come up with a broad-based plan that not only plugs the hole in next year’s budget but provides reliable revenue in future years.
Nobody wants to relive this year’s drama. That’s for certain.
Reach Barbara Shelly at 816-234-4594 or firstname.lastname@example.org. On Twitter @bshelly.