On Monday, the Kansas Legislature returned to finalize the 2017 session. To close shop and head home for the year, legislators must agree on three items: a biennial budget, a tax policy capable of paying for that biennial budget, and a school finance plan that includes a revenue source.
Legislators will attempt to resurrect a tax plan previously vetoed by the governor that includes a three-tiered tax bracket system, closes the LLC loophole, and stops the “glide-path” to zero income tax policy implemented in 2012. That proposal would see the highest earners pay an additional .85% per year. The main difference is that this proposal does not include a retroactive provision. The hope is to secure a 2/3 majority that would survive a gubernatorial veto. Getting to that number is tricky in the Senate.
See; KS Lawmakers on Tax Hike
See also; Legislators test interest in new tax
The state did receive some good news on Monday as April revenue numbers showed a slightly higher than projected increase. Kansas took in $1.8 million more dollars than previously forecast. This was in line with projections from the April Consensus Revenue Estimating Group, but it still leaves the state in a $900 million hole.
See; Kansas meets revenue estimate for April
The school finance issue will also play a vital role in ending the session since the Kansas Supreme Court added a June deadline to their spring decision. The basic format would be to increase school spending by $150 million each year for five years. The issue is how to pay for the increase. Sen. Jim Denning has proposed a utility tax of $3 per individual water meter and $10 for business meters. This would raise $159 million in revenue that would be earmarked for schools.
See; kansascity.com political article
If legislators could agree on these items in short form, they could adjourn as early as next week. However, odds-makers believe we are in for a long veto session. We will know a lot more once the tax bill is debated by the Kansas Senate this week.