The Kansas Legislative Session ended this past weekend but not before tying the record for longest session in Kansas history. The session was extended due to tax, budget and school finance issues. Both chambers passed a tax plan and then began work on the budget.
The tax plan (CCR for SB 30) passed in the House Chamber first on a vote of 69-52 while the Senate was nearly there when they adopted the bill 26-14. The tax plan will raise $591 million in FY 2018, and $633 million in FY 2019, but it will run into some issues four years out.
Key components of the tax package are as follows:
- Three tiers of income tax: 3.1%, 5.25% and 5.7%.
- Eliminate Glide Path to Zero
- Eliminate the business pass-through exemption (LLC Exemption).
- STAR Bond authority extended for 3 years; 1-year moratorium on new projects.
- Medical, mortgage interest and property tax deductibility reinstated; 3-year phase in.
- Child care tax credit reinstated.
The bill is retroactive to January 1, 2017 with modified rates for this year: 2.9%, 4.9% & 5.2%.
The new income brackets are as follows:
$30,000 - $60,000 5.25%
Late Monday night (June 5th), as the Senate was about to vote on SB 30, the Governor issued a statement that he would veto the measure upon receipt. True to his word, he vetoed the bill midday Tuesday.
To override a gubernatorial veto, both chambers must garner 2/3 majority of its members. The Senate requires 27 votes, and the House requires 84.
The governor's Tax Plan Veto was overridden by the Senate on a 27-13 count and by an 88-31 vote in the House.
Regarding the judicial branch, I am happy to report that HB 2041—extending the judicial branch surcharge fund—was approved by the Governor on May 26th. As approved, bill also contained provisions from HB 2053, dealing with debts owed the courts and the process for collecting those debts.
HB 2041 (supp. note) | Extending the judicial branch surcharge fee, courts costs and fees
In addition, the judicial branch requested an extension of the DUI reinstatement fee to help fund its budget. The court receives a percentage of the fees collected for reinstatement of a driver’s license following a DUI conviction. Annually, this amounts to nearly $950K. The House passed this bill on April 7th on a 72-52 vote. The conference committee added necessary language to HB 2041 raising the fee from $59 to $100, so the court will receive its increase of $41 per reinstatement, that will go toward nonjudicial personnel salary fund.
The remaining judicial budget issues concern personnel increases. The Omnibus Budget Conference Committee came to an agreement around midnight on Friday, June 9th to provide all state employees a pay increase of 2.5%. This is a move in the right direction, but it is far from the $20 million requested by the Judicial Branch, and its off by 9% from the original House position.
SB 189 Appropriations for FY17, FY18 & FY19
With the passage of the state budget, the Kansas Legislature ended a 113-day session. If you count Sine Die, the largely ceremonial final day of the legislative session, the 2017 session ties the record. The legislature dealt with some awfully large items this year including rolling back the 2012 tax policy, closing the LLC loophole, drafting a new school finance plan, creating a foster care task force and addressing human trafficking laws, to name a few. What consequences legislators face remain to be seen, but the election is only 17 months away.
Special thanks to the hardworking staff of the Kansas Revisor’s Office, Legislative Research, Post Audit, IT, Legislative Coordinating Council and Administrative Services. We couldn’t do it without these dedicated public employees, nor would we want to.
Kansas Bar Association
The KBA Legislative homepage: http://www.ksbar.org/?legislative
The official state website for the Kansas Legislature: www.kslegislature.org
Governor Sam Brownback
The website for Gov. Brownback and Lt. Gov. Jeff Colyer: http://www.kansas.gov/
Attorney General Derek Schmidt
The website for Attorney General Derek Schmidt: http://ag.ks.gov/
Legislative Summary Part I - http://www.kslegresearch.org/KLRD-web/Publications/SummaryofLegislation/PreliminarySummaries/2017-preliminary-summary.pdf
Legislative Summary Part II - http://www.kslegresearch.org/KLRD-web/Publications/SummaryofLegislation/PreliminarySummaries/2017-preliminary-summary-supp-I.pdf