Here is an article from the Wichita Eagle. Please reference this study when you contact our legislators. The full legislature reconvenes on Wednesday, April 28.
WSU study indicates tax increase less harmful than more budget cuts
BY TIM CARPENTER
Created April 19, 2010 at 3:33pm
Updated April 20, 2010 at 12:16am
The battle over Kansas economic projections intensified Monday with release of a Wichita State University study indicating closure of a state budget deficit with a $350 million tax increase would be less harmful to general economic vitality than an equivalent reduction in government spending.
The report adds to political debate raging in the 2010 Legislature on whether the state's financial deficit ought to be resolved by slicing at the edges of government spending or by imposing new taxes.
WSU's Center for Urban Studies and Kansas Public Finance Center outlined the influence on employment and economic output of a 1 percent increase in the state's retail sales tax. It follows a January report generated by a researcher at The University of Kansas' Center for Applied Economics.
"We decided to seek a second opinion," said Bernie Koch, executive director of the Kansas Economic Progress Council, which financed the WSU project. "This study shows there are no easy choices, but the solution that causes the least economic damage is a revenue enhancement."
The study coordinated by WSU economist John Wong started with the assumption a 1 percent hike in the sales tax would produce $350 million annually in new revenue. That is the amount of new tax revenue sought by Sen. Jay Emler, a Lindsborg Republican and chairman of the Senate budget committee.
According to the WSU analysis, adoption of the higher tax would reduce Kansas economic output by $363 million and curtail employment by 3,231 across the state. If the $350 million were realized by curtailing state expenditures, the WSU report says, there would be a loss of $420 million in output and force elimination 5,177 jobs.
Art Hall, of the KU Center for Applied Economics, said in testimony to a House committee a 1 percent sales tax increase would cost the state 19,000 jobs.
Democratic Gov. Mark Parkinson proposed to elevate the sales tax to 6.3 percent from 5.3 percent from July 1 to July 2013. It would generate an estimated $351 million per year.
Wong's analysis indicated the average Kansas household would pay an additional $266 in retail sales tax annually with a 1 percent hike. The most significant elements would be housing, $78; food, $69; and transportation, $43.
He said several factors argued in favor of the sales tax option.The new tax would be spread geographically across all Kansas consumers, while budget cuts would fall unevenly in regions and on individuals. The new revenue would be invested directly into the Kansas economy, he said. In addition, he said, people traveling in Kansas would pay a portion of the higher sales tax.
The Kansas Economic Progress Council, a not-for-profit group of businesses and organizations, sent a copy of the WSU report to Kansas legislators.
Friday, April 23, 2010
Monday, April 19, 2010
Revenue Estimates are down again
Here is an article from the Topeka Daily Capital published on Saturday, April 17. Revenue estimates are again down. But maybe, the recession has bottomed out.
Revenue outlook: a $70M shortfall
New forecast for Kansas budget is a downward change; gap could still grow.
By John Milburn - Associated Press Writer
TOPEKA -- A new revenue forecast issued Friday estimated a $70 million shortfall in the state budget year that ends June 30, meaning lawmakers and the governor will have to enact deeper spending cuts, delay payments or use additional federal stimulus money to balance the budget.
"The downward revision only makes the budget hole we have been working with larger," said state budget director Duane Goossen. "It's still a situation that can hopefully be managed."
The projected gap for the 2011 budget, which begins July 1, is now $450 million, but could grow to $510 million depending on how state officials solve the current year problem.
The figures released Friday reflect a downward revision in current year tax collections of $104.4 million from the November estimate. Leading that decline is further erosion in Kansas individual income tax collections, a reflection of the state's 6.9 percent unemployment rate for March.
Alan Conroy, head of the Kansas Legislative Research Department and member of the group that issued the revenue forecast, said labor officials predict the Kansas jobless rate will remain near the current level for the next year. That's well above the historical average of 4 percent unemployment for the state.
"There are flickers of hope. At best, the economic recovery is anemic," Conroy said.
Goossen said the new figures suggest Kansas revenue declines have bottomed out after three years of reductions. The new estimate is for tax collections to grow in 2011 by 3 percent, or some $154.3 million.
Democratic Gov. Mark Parkinson issued a statement saying the gap is too large to close with spending cuts alone without harming schools, public safety and social programs.
"Instead, we must implement a temporary solution so that we can create lasting economic recovery," Parkinson said. "That's why I reiterate my call for the Legislature to return to Topeka at the end of the month prepared to raise the revenue we need to prevent permanent damage to the foundation of our state."
The Republican-controlled Legislature returns April 28 to finish its work for the year. Neither the House nor Senate has approved a budget for 2011, nor any plan for new revenues to make it balance.
Parkinson has proposed $380 million in tax increases, including raising the state sales tax rate, but the plan has found little Statehouse support. His budget plan also includes small increases in K-12 education funding and the state receiving additional federal dollars.
Senate Majority Leader Derek Schmidt said finding a solution will require a bipartisan compromise among legislators and Parkinson.
"Balancing this budget will be a daunting task of historic proportions. There is no good or popular option that will get the job done," said Schmidt, an Independence Republican.
The Senate Ways and Means Committee will start working on its budget Monday and then turn to tax proposals.
Revenue outlook: a $70M shortfall
New forecast for Kansas budget is a downward change; gap could still grow.
By John Milburn - Associated Press Writer
Revenue outlook: a $70M shortfall
New forecast for Kansas budget is a downward change; gap could still grow.
By John Milburn - Associated Press Writer
TOPEKA -- A new revenue forecast issued Friday estimated a $70 million shortfall in the state budget year that ends June 30, meaning lawmakers and the governor will have to enact deeper spending cuts, delay payments or use additional federal stimulus money to balance the budget.
"The downward revision only makes the budget hole we have been working with larger," said state budget director Duane Goossen. "It's still a situation that can hopefully be managed."
The projected gap for the 2011 budget, which begins July 1, is now $450 million, but could grow to $510 million depending on how state officials solve the current year problem.
The figures released Friday reflect a downward revision in current year tax collections of $104.4 million from the November estimate. Leading that decline is further erosion in Kansas individual income tax collections, a reflection of the state's 6.9 percent unemployment rate for March.
Alan Conroy, head of the Kansas Legislative Research Department and member of the group that issued the revenue forecast, said labor officials predict the Kansas jobless rate will remain near the current level for the next year. That's well above the historical average of 4 percent unemployment for the state.
"There are flickers of hope. At best, the economic recovery is anemic," Conroy said.
Goossen said the new figures suggest Kansas revenue declines have bottomed out after three years of reductions. The new estimate is for tax collections to grow in 2011 by 3 percent, or some $154.3 million.
Democratic Gov. Mark Parkinson issued a statement saying the gap is too large to close with spending cuts alone without harming schools, public safety and social programs.
"Instead, we must implement a temporary solution so that we can create lasting economic recovery," Parkinson said. "That's why I reiterate my call for the Legislature to return to Topeka at the end of the month prepared to raise the revenue we need to prevent permanent damage to the foundation of our state."
The Republican-controlled Legislature returns April 28 to finish its work for the year. Neither the House nor Senate has approved a budget for 2011, nor any plan for new revenues to make it balance.
Parkinson has proposed $380 million in tax increases, including raising the state sales tax rate, but the plan has found little Statehouse support. His budget plan also includes small increases in K-12 education funding and the state receiving additional federal dollars.
Senate Majority Leader Derek Schmidt said finding a solution will require a bipartisan compromise among legislators and Parkinson.
"Balancing this budget will be a daunting task of historic proportions. There is no good or popular option that will get the job done," said Schmidt, an Independence Republican.
The Senate Ways and Means Committee will start working on its budget Monday and then turn to tax proposals.
Revenue outlook: a $70M shortfall
New forecast for Kansas budget is a downward change; gap could still grow.
By John Milburn - Associated Press Writer
Friday, April 16, 2010
Possible Federal Help to Schools
Here is an article from the Washington Post giving a national perspective on school finance and possible federal help.
Sen. Harkin proposes $23 billion bailout for schools
By Nick Anderson
Washington Post Staff Writer
Wednesday, April 14, 2010; 4:55 PM
As public schools nationwide face larger class sizes and cuts in programs, the Senate's leading Democrat on education issues proposed a $23 billion bailout Wednesday to help avert layoffs of tens of thousands of teachers and other school personnel in the coming academic year.
The bill sponsored by Sen. Tom Harkin (Iowa), a potential sequel to the economic stimulus law enacted last year, joins the mix of spending initiatives the Democratic-led Congress will consider this spring on issues such as aid to small business and appropriations for the war in Afghanistan.
Educators nationwide are warning that their finances have been stretched to the breaking point. The Prince George's County school board has approved a budget that slashes 800 positions. The Fairfax County school board has approved a salary freeze and cut of more than 200 positions. Los Angeles schools have notified 5,200 teachers, principals and other staff members that their jobs may be cut.
"You name it -- teachers, administrators, counselors, school nurses, cafeteria workers, support personnel are part of an exodus forced by financial realities," Ramon C. Cortines, Los Angeles schools superintendent, told senators in an appropriations hearing.
Education Secretary Arne Duncan estimated that school layoffs could total from 100,000 to 300,000 unless Congress acts.
"It is brutal out there, really scary," Duncan told reporters on Capitol Hill. "This is a real emergency. What we're trying to avert is an education catastrophe."
Duncan stopped just short of endorsing Harkin's bill. But he said efforts to improve schools will suffer if class sizes rise, summer school is cut and other programs are jettisoned.
Harkin, chairman of the Appropriations Committee's panel on education and of the Committee on Health, Education, Labor and Pensions, said time is running out because states are starting to issue layoff notices. "We must act soon," he said. "This is not something we can fix in August. We have to fix it now."
Whether his bill will gain traction remains to be seen. As of Wednesday afternoon, the bill had at least 13 Democratic co-sponsors, including Sen. Barbara A. Mikulski (Md.), but no Republican endorsements. Bipartisan support would help the spending bill sidestep a potential filibuster.
Sen. Richard C. Shelby (R-Ala.) said after the hearing that he was considering Harkin's proposal. "We cannot get ahead by underfunding education," he said.
Sen. Lamar Alexander (R-Tenn.) said he worried about where the government would find $23 billion for a bailout in a time of growing federal budget deficits. "I wonder from whose schoolchildren we are going to borrow this money, because we have a looming debt crisis in this country and we'll need to debate this," he said. "We all want to help our children and our schools, but that is a deep concern."
In December, the House approved a spending bill of similar scope to help save education jobs. But that measure stalled in the Senate.
The economic stimulus law enacted in February 2009 provided nearly $100 billion for education, much of it to help states avoid layoffs following the deepest economic recession in decades. But that source of aid will soon run out. Even though the economy appears to be recovering, state and local tax revenues remain stagnant. As a result, educators face what experts call a "funding cliff."
Last week the American Association of School Administrators reported that two-thirds of members surveyed cut positions for this school year and 90 percent expect to do so for the coming year. The survey of 453 administrators also found that 62 percent anticipated raising the average class size, 34 percent were considering the elimination of summer school and 13 percent were weighing the possibility of a four-day school week.
In California, the budget situation is so bleak that more than 20,000 educators have been given notice they might not be rehired in the next school year. Actress Megan Fox was moved to produce a nearly four-minute video that dramatizes the school budget crisis. In the video, circulating on the Internet this month, a clueless Fox wanders into a classroom stuffed with several dozen students who assume she has become their instructor.
"Wait, you guys don't have a teacher?" she asks.
"She was laid off," replies one girl.
"And then they combined art class with another teacher's class," says another.
Fox concluded the video with an appeal targeting California Gov. Arnold Schwarzenegger (R): "Make your voice heard. Call, write and annoy the governor until he cries for his mommy."
Sen. Harkin proposes $23 billion bailout for schools
By Nick Anderson
Washington Post Staff Writer
Wednesday, April 14, 2010; 4:55 PM
As public schools nationwide face larger class sizes and cuts in programs, the Senate's leading Democrat on education issues proposed a $23 billion bailout Wednesday to help avert layoffs of tens of thousands of teachers and other school personnel in the coming academic year.
The bill sponsored by Sen. Tom Harkin (Iowa), a potential sequel to the economic stimulus law enacted last year, joins the mix of spending initiatives the Democratic-led Congress will consider this spring on issues such as aid to small business and appropriations for the war in Afghanistan.
Educators nationwide are warning that their finances have been stretched to the breaking point. The Prince George's County school board has approved a budget that slashes 800 positions. The Fairfax County school board has approved a salary freeze and cut of more than 200 positions. Los Angeles schools have notified 5,200 teachers, principals and other staff members that their jobs may be cut.
"You name it -- teachers, administrators, counselors, school nurses, cafeteria workers, support personnel are part of an exodus forced by financial realities," Ramon C. Cortines, Los Angeles schools superintendent, told senators in an appropriations hearing.
Education Secretary Arne Duncan estimated that school layoffs could total from 100,000 to 300,000 unless Congress acts.
"It is brutal out there, really scary," Duncan told reporters on Capitol Hill. "This is a real emergency. What we're trying to avert is an education catastrophe."
Duncan stopped just short of endorsing Harkin's bill. But he said efforts to improve schools will suffer if class sizes rise, summer school is cut and other programs are jettisoned.
Harkin, chairman of the Appropriations Committee's panel on education and of the Committee on Health, Education, Labor and Pensions, said time is running out because states are starting to issue layoff notices. "We must act soon," he said. "This is not something we can fix in August. We have to fix it now."
Whether his bill will gain traction remains to be seen. As of Wednesday afternoon, the bill had at least 13 Democratic co-sponsors, including Sen. Barbara A. Mikulski (Md.), but no Republican endorsements. Bipartisan support would help the spending bill sidestep a potential filibuster.
Sen. Richard C. Shelby (R-Ala.) said after the hearing that he was considering Harkin's proposal. "We cannot get ahead by underfunding education," he said.
Sen. Lamar Alexander (R-Tenn.) said he worried about where the government would find $23 billion for a bailout in a time of growing federal budget deficits. "I wonder from whose schoolchildren we are going to borrow this money, because we have a looming debt crisis in this country and we'll need to debate this," he said. "We all want to help our children and our schools, but that is a deep concern."
In December, the House approved a spending bill of similar scope to help save education jobs. But that measure stalled in the Senate.
The economic stimulus law enacted in February 2009 provided nearly $100 billion for education, much of it to help states avoid layoffs following the deepest economic recession in decades. But that source of aid will soon run out. Even though the economy appears to be recovering, state and local tax revenues remain stagnant. As a result, educators face what experts call a "funding cliff."
Last week the American Association of School Administrators reported that two-thirds of members surveyed cut positions for this school year and 90 percent expect to do so for the coming year. The survey of 453 administrators also found that 62 percent anticipated raising the average class size, 34 percent were considering the elimination of summer school and 13 percent were weighing the possibility of a four-day school week.
In California, the budget situation is so bleak that more than 20,000 educators have been given notice they might not be rehired in the next school year. Actress Megan Fox was moved to produce a nearly four-minute video that dramatizes the school budget crisis. In the video, circulating on the Internet this month, a clueless Fox wanders into a classroom stuffed with several dozen students who assume she has become their instructor.
"Wait, you guys don't have a teacher?" she asks.
"She was laid off," replies one girl.
"And then they combined art class with another teacher's class," says another.
Fox concluded the video with an appeal targeting California Gov. Arnold Schwarzenegger (R): "Make your voice heard. Call, write and annoy the governor until he cries for his mommy."
Message from Kansas House Democratic Leader
Here is a message from Representative Paul Davis. Representative Davis is the Democratic Leader in the Kansas House. Later today, the official revenue estimates will be released. Hopefully they will be positive.
David
April 16, 2010
Dear Concerned Educator,
The Kansas Legislature has completed the 2010 Regular Session. We will reconvene on April 28th for the annual Wrap-Up Session. I know many of you are anxiously waiting to find out what will happen with the FY 2011 budget and this seemed an appropriate time to provide an update.
Every legislative session since 1996, the budget has been divided in two parts: a “Mega Appropriations Bill” and an “Omnibus Budget Bill.” The Mega Appropriations Bill is voted on prior to First Adjournment and includes the bulk of funding for state agencies. During the annual Wrap-Up Session, the Legislature takes up the Omnibus Budget Bill, which makes adjustments based on updated revenue estimates (updated estimates become available after taxes are filed on April 15th. The next round of estimates are actually being released this afternoon).
We had expected to debate the Mega Appropriations bill before First Adjournment as usual, but the vote was postponed until Wrap-Up session. As much as I regret to prolong the suspense, this was probably the right decision. The appropriations process is always challenging- even when there are surpluses. During economic downfalls when there are no “good” choices, it becomes next to impossible. The revenue gap was projected at $400 million when the last estimates were made in November 2009 and that gap has grown steadily each month. Additionally, some pending federal proposals would significantly decrease the size of the shortfall if approved. After six rounds of cuts, there is a big difference between a $400 million and a $500 million hole. It is best to wait to make the most difficult (and important) decisions of the session until the most accurate numbers are available.
In February, we encouraged you and your community to voice your concerns about additional cuts to public education in the next fiscal year. I want to personally thank you for answering that call. In addition to your letters and phone calls, approximately 1,000 teachers, students and parents from across the state (as far west as Colby) took advantage of Spring Break by marching to the Capitol.
We can’t stop now. Before First Adjournment, House Republican Leaders proposed an additional $200 million cut public education. As you well know, such a cut would be detrimental to local districts, as well as local economies. The House Republican Leadership’s plan clearly indicates their lack of commitment to our schoolchildren and will result in passing the buck onto local communities in the form of higher property taxes. The attached handout shows the effect that the House Republican plan would have on your local school district.
Despite the fact that the Legislature has a constitutional obligation to fund quality public schools, deeper cuts to education would be terribly short-sighted. The economy of Kansas will not grow if we are unable to provide a highly trained, educated workforce to the business community. You may have read in the newspaper recently about how fourteen local chambers of commerce came out in support of revenue increases. They clearly recognize the importance of funding education as it relates to economic growth.
It will take years to recover from the damage schools have already endured, and I know you understand this better than anyone. I hope you will continue to be direct and clear with your patrons in telling them what services/programs/positions will be eliminated if the proposed cuts go through in the next fiscal year. Keep encouraging them to contact legislators. If your local legislators refuse to listen, I urge you and your community to keep that in mind next November.
House Democrats, some moderate House Republicans (along with our counterparts in the Senate) and Governor Parkinson are working together to do all we can to protect K-12 education amid this economic crisis. We believe that the quality of our education system is directly tied to our state’s economic security and we will stand by that principle as we cast the final votes of the 2010 session.
We look forward to hearing from you and we will be in touch again soon.
Sincerely,
Representative Paul Davis,
Kansas House Democratic Leader
300 S.W. 10th Avenue, Ste. 359-W
Topeka, KS 66612
(W) 785.296.7630
(F) 785.296.0251
http://www.kshousedems.com/
David
April 16, 2010
Dear Concerned Educator,
The Kansas Legislature has completed the 2010 Regular Session. We will reconvene on April 28th for the annual Wrap-Up Session. I know many of you are anxiously waiting to find out what will happen with the FY 2011 budget and this seemed an appropriate time to provide an update.
Every legislative session since 1996, the budget has been divided in two parts: a “Mega Appropriations Bill” and an “Omnibus Budget Bill.” The Mega Appropriations Bill is voted on prior to First Adjournment and includes the bulk of funding for state agencies. During the annual Wrap-Up Session, the Legislature takes up the Omnibus Budget Bill, which makes adjustments based on updated revenue estimates (updated estimates become available after taxes are filed on April 15th. The next round of estimates are actually being released this afternoon).
We had expected to debate the Mega Appropriations bill before First Adjournment as usual, but the vote was postponed until Wrap-Up session. As much as I regret to prolong the suspense, this was probably the right decision. The appropriations process is always challenging- even when there are surpluses. During economic downfalls when there are no “good” choices, it becomes next to impossible. The revenue gap was projected at $400 million when the last estimates were made in November 2009 and that gap has grown steadily each month. Additionally, some pending federal proposals would significantly decrease the size of the shortfall if approved. After six rounds of cuts, there is a big difference between a $400 million and a $500 million hole. It is best to wait to make the most difficult (and important) decisions of the session until the most accurate numbers are available.
In February, we encouraged you and your community to voice your concerns about additional cuts to public education in the next fiscal year. I want to personally thank you for answering that call. In addition to your letters and phone calls, approximately 1,000 teachers, students and parents from across the state (as far west as Colby) took advantage of Spring Break by marching to the Capitol.
We can’t stop now. Before First Adjournment, House Republican Leaders proposed an additional $200 million cut public education. As you well know, such a cut would be detrimental to local districts, as well as local economies. The House Republican Leadership’s plan clearly indicates their lack of commitment to our schoolchildren and will result in passing the buck onto local communities in the form of higher property taxes. The attached handout shows the effect that the House Republican plan would have on your local school district.
Despite the fact that the Legislature has a constitutional obligation to fund quality public schools, deeper cuts to education would be terribly short-sighted. The economy of Kansas will not grow if we are unable to provide a highly trained, educated workforce to the business community. You may have read in the newspaper recently about how fourteen local chambers of commerce came out in support of revenue increases. They clearly recognize the importance of funding education as it relates to economic growth.
It will take years to recover from the damage schools have already endured, and I know you understand this better than anyone. I hope you will continue to be direct and clear with your patrons in telling them what services/programs/positions will be eliminated if the proposed cuts go through in the next fiscal year. Keep encouraging them to contact legislators. If your local legislators refuse to listen, I urge you and your community to keep that in mind next November.
House Democrats, some moderate House Republicans (along with our counterparts in the Senate) and Governor Parkinson are working together to do all we can to protect K-12 education amid this economic crisis. We believe that the quality of our education system is directly tied to our state’s economic security and we will stand by that principle as we cast the final votes of the 2010 session.
We look forward to hearing from you and we will be in touch again soon.
Sincerely,
Representative Paul Davis,
Kansas House Democratic Leader
300 S.W. 10th Avenue, Ste. 359-W
Topeka, KS 66612
(W) 785.296.7630
(F) 785.296.0251
http://www.kshousedems.com/
Friday, April 2, 2010
Hutch/Reno Co. Chamber of Commerce supports "rational revenue enhancements"
Here is an editorial from John Montgomery, Hutch News Editor, about the State Chamber of Commerce's agenda and how our local chamber and other influential chambers differ.
Narrow agenda
Hutch News
April 2, 2010
As the Kansas Chamber of Commerce has become increasingly active politically in recent years, it also has isolated itself from Main Street businesses. The organization's narrow political agenda now is alienating even local chambers of commerce.
Fourteen local chamber of commerce executives last month signed a letter to the governor and legislative leadership in the Statehouse urging a balanced approach to the state budget crisis, specifically "rational revenue enhancements" if necessary to avoid draconian cuts to education, transportation and state spending that affects quality of life.
That front-line chambers of commerce felt the need to speak up is not surprising. The state chamber doesn't reflect the viewpoint expressed in the letter.
The state chamber's legislative agenda mentions nothing about critical business issues such as education and transportation. Its message, rather, is don't raise taxes - cut them more - and cut government spending. The state chamber's political position reflects the narrow-minded view of many lawmakers who believe that any tax increase will hurt economic recovery when in reality some taxes have no impact on economic growth. And by taking this simplistic view, the chamber forgets that doing business isn't just about the tax environment. Savvy business leaders know when to invest: They invest in their workers, and they invest in their physical plant.
From a statewide perspective, that is why a quality education system is important. So is a quality transportation system. And, as the local chamber leaders' letter points out, so is quality of life for the working population.
The letter says nothing about the state chamber, and it wasn't meant to suggest a split between state and local chambers, said Hutchinson-Reno County chamber president Dave Kerr, who was "totally astonished by the state board's reaction and mischaracterization of it."
The purpose of the letter also was not to request a tax increase, Kerr said. "It was simply an effort to show we were willing to back legislators and show some flexibility knowing they have a tough situation. ... We're saying you might have to use a balanced approach."
Kerr is right. And the sentiment expressed by the local chambers should not be dismissed by the state chamber - or by legislators. These chambers are on the front lines, and they know what it takes to recruit and grow businesses. A favorable tax environment is helpful, but it isn't the only factor.
Kent Eckles, a Kansas chamber vice president, told the Associated Press that the letter wasn't from a majority of local chambers of commerce, making statements that confirm the state chamber's tunnel vision.
But these are big chambers of commerce, combined likely representing a majority of the state's population. To wit: Overland Park, Olathe, Northeast Johnson County, Greater Kansas City, Kansas City Kansas, Topeka, Salina, Hutchinson, Manhattan, Hays, Emporia, Dodge City, Arkansas City and Grant County.
One would think that a list of sizable chambers like that might get the attention of the state chamber. If not, this attitude probably explains why most businesses don't belong to the state chamber.
By John D. Montgomery/Hutchinson News editorial board
Narrow agenda
Hutch News
April 2, 2010
As the Kansas Chamber of Commerce has become increasingly active politically in recent years, it also has isolated itself from Main Street businesses. The organization's narrow political agenda now is alienating even local chambers of commerce.
Fourteen local chamber of commerce executives last month signed a letter to the governor and legislative leadership in the Statehouse urging a balanced approach to the state budget crisis, specifically "rational revenue enhancements" if necessary to avoid draconian cuts to education, transportation and state spending that affects quality of life.
That front-line chambers of commerce felt the need to speak up is not surprising. The state chamber doesn't reflect the viewpoint expressed in the letter.
The state chamber's legislative agenda mentions nothing about critical business issues such as education and transportation. Its message, rather, is don't raise taxes - cut them more - and cut government spending. The state chamber's political position reflects the narrow-minded view of many lawmakers who believe that any tax increase will hurt economic recovery when in reality some taxes have no impact on economic growth. And by taking this simplistic view, the chamber forgets that doing business isn't just about the tax environment. Savvy business leaders know when to invest: They invest in their workers, and they invest in their physical plant.
From a statewide perspective, that is why a quality education system is important. So is a quality transportation system. And, as the local chamber leaders' letter points out, so is quality of life for the working population.
The letter says nothing about the state chamber, and it wasn't meant to suggest a split between state and local chambers, said Hutchinson-Reno County chamber president Dave Kerr, who was "totally astonished by the state board's reaction and mischaracterization of it."
The purpose of the letter also was not to request a tax increase, Kerr said. "It was simply an effort to show we were willing to back legislators and show some flexibility knowing they have a tough situation. ... We're saying you might have to use a balanced approach."
Kerr is right. And the sentiment expressed by the local chambers should not be dismissed by the state chamber - or by legislators. These chambers are on the front lines, and they know what it takes to recruit and grow businesses. A favorable tax environment is helpful, but it isn't the only factor.
Kent Eckles, a Kansas chamber vice president, told the Associated Press that the letter wasn't from a majority of local chambers of commerce, making statements that confirm the state chamber's tunnel vision.
But these are big chambers of commerce, combined likely representing a majority of the state's population. To wit: Overland Park, Olathe, Northeast Johnson County, Greater Kansas City, Kansas City Kansas, Topeka, Salina, Hutchinson, Manhattan, Hays, Emporia, Dodge City, Arkansas City and Grant County.
One would think that a list of sizable chambers like that might get the attention of the state chamber. If not, this attitude probably explains why most businesses don't belong to the state chamber.
By John D. Montgomery/Hutchinson News editorial board
Thursday, April 1, 2010
Governor's support for K-12 Education remains strong
There are many different views on how to handle the 2010 budget deficit. However, the Governor stays committed to K-12 Education. Here is an article from the Topeka Capital-Journal on-line.
Gov renews call for tax increases
Parkinson believes most legislators 'reluctantly' agree not much left to trim from budget
By Barbara Hollingsworth
Topeka Capital-Journal
Created March 31, 2010 at 2:38pm
Updated April 1, 2010 at 12:11am
A four-week break at home will give Kansas lawmakers plenty of time to hear from constituents.
They most likely will hear about tax increases and government spending, as well as budget cuts to schools, Medicaid and transportation. And in the end, Gov. Mark Parkinson reasserted on Wednesday that lawmakers must work toward a tax increase in order to avoid cuts that would devastate the state's economy. Lawmakers will return April 28 after leaving in the early morning hours Wednesday.
"As the legislators head home for their April recess, they will be given a chance to hear how their constituents want them to balance the budget when they return at the end of the month," Parkinson said. "Do Kansans want them to continue cutting schools, highways maintenance, and aid to the elderly and disabled? Or, do Kansans want the Legislature to raise the revenue needed to protect these critical assets?"
Parkinson noted that Kansas is showing signs of an improving economy. In numbers announced Wednesday afternoon, tax collections topped expectations by $12 million in March. It is a welcome sign but doesn't erase the first nine months of the year when state revenues fell behind forecasts by $93 million. Nor does that bump lessen the budget gap exceeding $400 million for next fiscal year.
Parkinson, who has made cuts and reallocations amounting to about $1 billion, has repeatedly said he doesn't believe there is room to cut further. Most lawmakers, he said, "reluctantly" agree with him after three months of discussing the budget.
"Legislators that are traditionally considered as conservative have confided in me and some have spoken openly about the fact that we simply cannot cut any more," Parkinson said.
Parkinson renewed calls for raising the cigarette tax and increasing the state sales tax by 1 cent. Lawmakers left this week without passing a budget bill. The final budget work is traditionally done during the veto session, which will begin April 28, but even longtime lawmakers couldn't remember a session in which they left for their first break without having approved an initial budget bill.
House Speaker Mike O'Neal said leaving without a budget is a disappointment — a situation he blamed on the Senate's inability to get a tax package approved in committee work, though some leaders in the Senate pointed to doubts the House had enough votes to pass its budget bill. Leaders in the House, O'Neal said, remain determined to proceed without a tax increase.
"We're not going to simply look at a number for deficits and revenues and fill it with taxes," said O'Neal, R-Hutchinson. "That's silly."
Parkinson on Tuesday dismissed the House budget plan as "irresponsible." He rejected any attempts to cut funding for K-12 education, but indicated he might be willing to accept some modest budget cuts.
"I do understand at the end of the day there may need to be some compromises," he said.
In the Senate, work has focused on a mix of tax increases and more limited tax cuts. So far, sales tax, liquor taxes and cigarette taxes have been heavily discussed, said Senate President Steve Morris, R-Hugoton.
"Nothing," he said, "is off the table."
The Senate Ways and Means Committee will return a week before the rest of lawmakers to resume work on the budget bill. By that time, lawmakers will have the latest revenue projections.
The committee's chairman, Sen. Jay Emler, R-Lindsborg, said the tasks will include producing a tax proposal after several attempts at developing a tax package failed in the Senate's tax committee. Emler said there are too many lawmakers who see too many cuts as being off the table to balance the budget with reductions alone.
"You have to take a look at what lines have been drawn in the sand," he said.
Gov renews call for tax increases
Parkinson believes most legislators 'reluctantly' agree not much left to trim from budget
By Barbara Hollingsworth
Topeka Capital-Journal
Created March 31, 2010 at 2:38pm
Updated April 1, 2010 at 12:11am
A four-week break at home will give Kansas lawmakers plenty of time to hear from constituents.
They most likely will hear about tax increases and government spending, as well as budget cuts to schools, Medicaid and transportation. And in the end, Gov. Mark Parkinson reasserted on Wednesday that lawmakers must work toward a tax increase in order to avoid cuts that would devastate the state's economy. Lawmakers will return April 28 after leaving in the early morning hours Wednesday.
"As the legislators head home for their April recess, they will be given a chance to hear how their constituents want them to balance the budget when they return at the end of the month," Parkinson said. "Do Kansans want them to continue cutting schools, highways maintenance, and aid to the elderly and disabled? Or, do Kansans want the Legislature to raise the revenue needed to protect these critical assets?"
Parkinson noted that Kansas is showing signs of an improving economy. In numbers announced Wednesday afternoon, tax collections topped expectations by $12 million in March. It is a welcome sign but doesn't erase the first nine months of the year when state revenues fell behind forecasts by $93 million. Nor does that bump lessen the budget gap exceeding $400 million for next fiscal year.
Parkinson, who has made cuts and reallocations amounting to about $1 billion, has repeatedly said he doesn't believe there is room to cut further. Most lawmakers, he said, "reluctantly" agree with him after three months of discussing the budget.
"Legislators that are traditionally considered as conservative have confided in me and some have spoken openly about the fact that we simply cannot cut any more," Parkinson said.
Parkinson renewed calls for raising the cigarette tax and increasing the state sales tax by 1 cent. Lawmakers left this week without passing a budget bill. The final budget work is traditionally done during the veto session, which will begin April 28, but even longtime lawmakers couldn't remember a session in which they left for their first break without having approved an initial budget bill.
House Speaker Mike O'Neal said leaving without a budget is a disappointment — a situation he blamed on the Senate's inability to get a tax package approved in committee work, though some leaders in the Senate pointed to doubts the House had enough votes to pass its budget bill. Leaders in the House, O'Neal said, remain determined to proceed without a tax increase.
"We're not going to simply look at a number for deficits and revenues and fill it with taxes," said O'Neal, R-Hutchinson. "That's silly."
Parkinson on Tuesday dismissed the House budget plan as "irresponsible." He rejected any attempts to cut funding for K-12 education, but indicated he might be willing to accept some modest budget cuts.
"I do understand at the end of the day there may need to be some compromises," he said.
In the Senate, work has focused on a mix of tax increases and more limited tax cuts. So far, sales tax, liquor taxes and cigarette taxes have been heavily discussed, said Senate President Steve Morris, R-Hugoton.
"Nothing," he said, "is off the table."
The Senate Ways and Means Committee will return a week before the rest of lawmakers to resume work on the budget bill. By that time, lawmakers will have the latest revenue projections.
The committee's chairman, Sen. Jay Emler, R-Lindsborg, said the tasks will include producing a tax proposal after several attempts at developing a tax package failed in the Senate's tax committee. Emler said there are too many lawmakers who see too many cuts as being off the table to balance the budget with reductions alone.
"You have to take a look at what lines have been drawn in the sand," he said.
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