July 15, 2010

Let the voting begin!

Yesterday was the start of advance voting for the 2010 primary election in Kansas. We wonder if you are one of the first Kansans to cast a ballot in this election.

Vote by mail is now officially off and running. In addition, county election officers were permitted to begin advance voting in person yesterday.

If you are interested in advance voting in person, you should know that the date may be different in your county – while every county MAY begin on July 14, they are not required to have advance voting in person until July 27. Johnson County, for example, does not start advance voting in person until July 20.

In most counties, advance voting in person takes place in the County election office (usually in the County Building) although in some counties there are satellite locations (Johnson and Sedgwick, for example). Phone your county election office or check on line for more information.

Here’s what Kansas Secretary of State Chris Biggs had to say in an email blast yesterday:

“Casting your vote for the candidate of your choosing is an important part of the democratic process. In Kansas there’s no excuse not to vote because with advance voting, any registered voter can vote by mail or in person before Election Day. Contact your county election office or visit www.voteks.org to learn more about advance voting or to request an advance ballot.”

Are these primary elections really all that important?

Glad you asked! The simple answer is “YES!”

KNEA has identified a number of critically important primary election races for this year as we strive to maintain a pro-public education majority in the Kansas Legislature. KNEA members received a special email message regarding these races. We hope that if you live in one of those districts, you’ll make sure to get out there and cast your vote.

There will be a lot of mail over the next couple of weeks telling you to vote for some candidate because he or she would not have supported the budget that prevented more cuts to education, public safety, and the social service safety net. You better believe that those who think schools and social services are over-funded will be voting.

These primary elections are a chance for Kansans who care about their communities to let legislators know that we value a quality public education, care for our seniors and those with disabilities, and safe roads and highways.

So…NO EXCUSES! Get out there and vote! Take your friends and neighbors, your spouse, your parents! VOTE!

Special Wrap-up Edition, 2010

Session closes; we sigh with relief!

The 2010 Kansas Legislative Session came to an end on May 11, leaving those who provide services to the citizens of this state breathing a sigh of relief thanks to the passage of a good House budget and a good Senate tax plan to support that budget.

As we entered the session in January, we had Governor Mark Parkinson challenging the legislature to stop the cuts and enact a tax increase to keep our state solvent. The reaction was less than enthusiastic – especially from the House where anti-tax, anti-government types hold key leadership positions and the chairmanships of most committees. We knew it would be a struggle just to hold our own.

KNEA worked as usual with the Kansas Association of School Boards, United School Administrators of Kansas, and a variety of other public school advocates to craft responses to various proposals and keep legislators informed as to the impact of budget cuts and potential additional cuts. But beginning last summer we were also meeting with other groups in a coalition known as Kansans for Quality Communities or KQC.

KQC came together because of our mutual interest in preserving the services that Kansans depend on and that enhance the quality of life in our state and local communities. Among those in the coalition are representatives of Kansans with physical and developmental disabilities, senior citizen advocacy groups, those who provide mental health services, early childhood advocates, state employees including public safety officers and other first responders. The members of KQC determined that the quality of life in Kansas is dependent on excellent schools, support for our most vulnerable citizens, safe streets and communities, and a great system of roads and highways.

KQC members determined that a threat to one service is a threat to all. We needed to stand shoulder to shoulder to protect Kansas communities and that’s just what we did.

We were attacked almost from day one of this session by a variety of Koch Industries-funded/supported anti-government organizations – the Kansas Policy Institute, Americans for Prosperity, the Center for Applied Economics – all of which were (and still are) determined to drown Kansas in Grover Norquist’s bathtub.

In the end, rationale minds prevailed. A majority of Kansas legislators decided to listen to the service providers in Kansans for Quality Communities, the business interests in the Kansas Economic Policy Council, and all the local businesses represented by 16 local Chambers of Commerce who broke with the state chamber in support of their communities and their neighbors.

Senate President Steve Morris (R-Hugoton), Vice President John Vratil (R-Leawood) and Minority Leader Anthony Hensley (D-Topeka) led a bipartisan coalition of 21 senators in crafting a tax plan that would support maintaining state services. House Minority Leader Paul Davis (D-Lawrence) worked with Rep. Bill Feuerborn (D-Garnett) and key moderate Republican leaders like Rep. Charlie Roth (R-Salina) and Rep. Don Hineman (R-Dighton) to craft a responsible budget that would keep Kansas strong. And they had the backing of 71 House Democrats and Republicans in passing that budget over the objections of House Speaker Mike O’Neal (R-Hutchinson) and Appropriations Chairman Kevin Yoder (R-Overland Park).

It was a sight to see. We still have a majority of Kansas legislators who will put community and quality of life ahead of blind obedience to the anti-everything crowd. We should all be deeply grateful to the 71 House members and 21 Senators who stood up for Kansas this year.

The House members who voted in favor of the budget were:

Ballard, Barnes, Benlon, Bethell, Brookens, Tony Brown, Burroughs, Carlin, Colloton, Craft, Crow, Davis, Dillmore, Feuerborn, Finney, Flaharty, Frownfelter, Furtado, Garcia, Doug Gatewood, Sean Gatewood, George, Grant, Hawk, Henderson, Henry, Hill, Hineman, Horst, Johnson, Kuether, Lane, Light, Loganbill, Long, Lukert, Mah, McCray-Miller, Meier, Menghini, Moxley, Neighbor, Palmer, Pauls, Peterson, Phelps, Pottorff, Prescott, Proehl, Quigley, Rardin, Roth, Ruiz, Schroeder, Shultz, Slattery, Sloan, Spalding, D. Svaty, Swanson, Swenson, Tafanelli, Talia, Tietze, Trimmer, Ward, Wetta, Williams, Winn, K. Wolf, and Worley. (Republicans are underlined.)

Barbara Bollier who supported every motion to build the budget was absent for the final vote. We are confident that Bollier would have supported the budget.

The Senators who moved the tax plan forward were:

Brungardt, Emler, Faust-Goudeau, Francisco, Haley, Hensley, Holland, Huntington, Kelly, Kultala, Lee, Marshall, McGinn, Morris, Ostmeyer, Owens, Reitz, V. Schmidt, Schodorf, Taddiken, Teichman, Umbarger, and Vratil. (Republicans are underlined.)

The above named legislators brought rational thinking and responsible decision-making to the statehouse. Each of them deserves the gratitude of every Kansan who values the quality of life that makes Kansas a wonderful place to live, work, and raise a family.

School finance in the budget

There were far too many school finance proposals floated in the 2010 session to go into all of them here. Most of those proposals were brought forth by the conservatives in the House who were looking for any way to absolve themselves of any school funding responsibility and pass all decisions to local school boards.

Most of the conservative proposals involved simply passing the responsibility for school funding off on to the local residential property tax base and leaving the decision for doing so with the local school board. Some conservatives latched on to radical ideas such as Walt Chappell’s proposal to consolidate all school districts into 40 mega districts or ideas from the Legislative Post Audit “efficiency” studies to simply drop block schedules, increase class sizes, close buildings and reduce the number of teachers.

And House Republicans on the Appropriations Committee (who are not on the list above!) tried to say that not replacing disappearing federal stimulus money that was used to fill state funding cuts from 2009 was not a reduction in funding; it’s just money that’s no longer available. The Yoder budget that supposedly did not cut funding, also did not replace the stimulus money and would have resulted in significant school district budget cuts.

In the budget passed by the coalition of House Democrats and Moderate Republicans (see the list above!) the stimulus funds were replaced with state dollars. This means that, while schools will not see an increase in funding next year, they will not see a decrease. This is a major victory for supporters of public education.

Teacher attacks

KNEA had to deal this year with a couple of attacks on teacher rights. There were two bills dealing with the continuing contract law and one dealing with a teacher’s probationary period.

One of the proposed changes to the continuing contract law would have removed retirees who return to work from the provisions of the law. This is the last remaining right that these teachers enjoy, having been removed from professional negotiations and due process several years ago. We argued that these teachers at least deserve the courtesy of timely notice regarding their employment. Despite our pleas, the bill came out of the Senate Education Committee. Fortunately, it was defeated on the Senate floor when eleven Republicans joined with 9 Democrats in voting NO.

The other proposal would have changed the notice date for all teachers to an unspecified date tied to the signing of a budget bill by the Governor. This bill was eventually changed by the Senate to either June 1 or May 1 depending on the wishes of the local school board. KNEA objected to two dates and to having a date outside of the school year. A House Committee agreed to one date in the school year and moved it to May 15. We agreed to this as a compromise position.

Unfortunately the committee also put into it the bill changing the probationary period from the current three years to five years, a provision with which we strongly disagreed.

On the floor of the House, a majority of representatives listened to teachers and removed the change in the probationary period. Those voting to support teachers and remove the change to the probationary period were:

Ballard, Barnes, Benlon, Bollier, T. Brown, Burroughs, Carlin, Craft, Crow, Crum, Davis, Dillmore, Feuerborn, Finney, Flaharty, Frownfelter, Furtado, Garcia, D. Gatewood, S. Gatewood, Goyle, Grange, Grant, Hawk, Henderson, Henry, Hill, Horst, Kerschen, King, Kuether, Lane, Light, Loganbill, Long, Lukert, Mah, McCray-Miller, Meier, Menghini, Neighbor, Otto, Palmer, Pauls, Peterson, Phelps, Pottorff, Prescott, Quigley, Rardin, Roth, Ruiz, Schwartz, Shultz, Slattery, Sloan, Spalding, D. Svaty, Swenson, Talia, Tietze, Trimmer, Ward, Wetta, Williams, Winn, K. Wolf,and Worley. (Republicans are underlined.)

The compromise on the notice date passed and went to a conference committee where the Wichita School District managed to persuade the members to push the date once again out of the school year for the majority of Kansas teachers. The conference committee report was almost ready to go when we managed – with the help of USA – to get the report back and amended once again, compromising on the third Friday in May as the new notice date.

While we still don’t think the change is a good idea, we recognized the need to compromise on the issue. Many legislators were concerned that since a budget is rarely adopted by May 1, a change was needed.

Now we turn our attention to the new House – the one YOU will elect in November

The session is over, this battle has been won, but the war is far from over. There will continue to be attacks on Kansas public schools, government services, and the quality of life we enjoy. This session gave us a good look at which legislators will stand up for Kansas communities and which ones are only interested in shrinking the services that we all depend on.

The anti-government crowd was held at bay this year but they will back next year and they plan to make themselves known in the elections of 2010 and 2012. Within hours of the Senate passing the tax plan, flyers appeared in the capitol attacking any Republican who voted for the plan. The flyers were vicious attacks and, of course, were anonymous.

An email message from the Kansas Chamber of Commerce said the following:

“As you know, the Kansas Chamber Board supported a unified agenda to oppose any and all tax increases. Changes are needed in the Legislature and we need your support today to fund our Political Action Committee. Our PAC will be making direct contributions to candidates who support business and also will be supporting them through independent expenditures. We are busy recruiting candidates and many are ready to file. There is no doubt the public is fed up with high taxes and runaway spending. If our candidates are funded, they will win.”

During the session, Kansas Chamber CEO Kent Beisner said, “As of today, the Legislature has failed to address the needs and wishes of the business community. It has instead catered to the needs of those at the government trough.”

Make no mistake about it. Those pigs at the trough are teachers and school children. They are Kansans with disabilities and those in a mental health crisis. The pigs at the trough are correctional officers who stand between you and the inmates; they are highway workers who keep our roads clear and safe; they are highway patrol officers who respond when there is an accident. The pigs at the trough are the men and women who watch over foster children and who provide in-home services to seniors.

This reasoning by the Kansas State Chamber of Commerce is exactly why local chambers are breaking away. The men and women who run businesses in our communities know that those government services are the very things that keep our communities strong and help their businesses to thrive.

And that’s a message we must all take to heart. We must share it with everyone we know. And ultimately we must elect legislators who believe it as well.

House passes tax bill!

Budget & Tax off to the Governor

About 2:00 am the House finally closed the roll and tallied the vote on HB 2360, the tax bill assembled by the Senate Ways and Means Committee and passed by the full Senate late last week. This action closes the budget battle of 2010.

It was a long night as the voted flipped back and forth between pass and fail during two long calls of the House. A call is put into place at the request of the members usually when a controversial issue is coming to a close vote. Some member or members are missing and the doors are closed while officers are sent in search of the missing member. This gives both sides of the issue an opportunity to work to persuade others to come over to their side.

Initially the call was at the request of the coalition members since they needed to find just a couple more votes to win. When they hit the magic number of 63, the call was lifted. But then the House leadership put up another call – apparently in search of Rep. Virgil Peck (R-Tyro) who had gone home to attend a church service. That call then held until Peck made the over two hour trek back to Topeka where he cast a NO vote.

With all 125 members in the House, the call was over and the bill declared passed on a vote of 64 to 61.

At that point, there was a motion by Rep. Jim Ward (D-Wichita) to reconsider. This is another common procedural motion on controversial issues. If the motion to reconsider fails, then no further action can be taken. One has 24 hours in which to reconsider.

Immediately after Ward’s motion, Rep. Lance Kinzer (R-Olathe) moved to table the motion to reconsider. If successful, this would have given the anti-tax folks overnight to twist arms. The motion to table failed taking them back to Ward’s motion to reconsider. The motion to reconsider failed on a voice vote thus ending all action on this measure and sending it to the Governor.

Senate adopts last education conference committee report

Late last night the Senate adopted the conference committee report on HB 2704. This bill has five provisions:

• It allows three or more school districts to consolidate into a less number of districts,
• It redefines “taxable tangible property” in the school finance law to include motor vehicle taxes,
• It allows students who transfer from a closed school or discontinued school due to consolidation to be eligible for interschool activities immediately upon transfer,
• It allows school districts who transferred money from the general fund to the capital outlay fund to transfer that money back to the general fund, and
• It puts in place a linear transition for high and medium density at-risk weightings once base state aid per pupil reaches $4,492.

This is the last bit of education policy that the House must consider. We expect that vote this afternoon.

Out today?

That’s certainly what we expect. The big issues – budget and taxes – are now done. The Senate is essentially done already. The House must still deal with the transportation plan and a nursing home bed tax passed by the Senate in addition to HB 2704. The first two may generate some spirited debate but after several long, long nights they might just want to finish up.

Once they are gone, look for our wrap up edition of Under the Dome as well as information on how legislators voted on the big issues.

Part 2

It’s over!

The 2010 Legislative Session came to an end – except for the generally ceremonial sine die meeting on May 28 – at about 5:00 this evening.

The Senate wrapped up just about everything last night well before the House finished the tax debate. When Senators arrived this morning they determined that it was not necessary for the full group to stay around so many headed home leaving a quorum in Topeka in case anything came up. Nothing did.

The House began shortly aft 2:00 and plowed through a number of conference committee reports, two of which met with some debate. The transportation plan and a plan for a provider tax on nursing homes were debated but in the end passed handily.

We were waiting possible action on the conference committee report on 2704 but that action never came. This means the bill is dead for all intents and purposes.

Both chambers are now out until May 28, the sine die session that marks the official end of the annual legislative session. While it is possible for issues to be taken up at that time, it is generally reserved only to deal with any vetoes of legislation done in these last few days. Sometimes there is not even a quorum present.

We will be preparing a special edition of Under the Dome summarizing the session and providing you with information on how specific legislators voted on important issues. Look for it by the end of the week!

House kills SB 74, KPERS pass-through for LOB

In early action today, the House voted down Senate Bill 74 which contained the language sending KPERS employer contributions through the school district general fund which would increase the amount of money an LOB would raise.

A compromise on the bill would have let districts access this money for the 2010-11 school year without a vote. After the first year, to keep getting the funds, the district would have to put the issue to a public vote. Any increases would also be equalized in the second year but not the first.

This bill has been seen as a key to ensuring Johnson County support for the budget and tax bills but a number of Johnson County Republican legislators voted no immediately. Johnson County Republicans who voted no were Anthony Brown, Owen Donohoe, Mike Kiegerl, Lance Kinzer, Ray Merrick, Scott Schwab, and Arlen Siegfreid. Their lack of support was key to the defeat of the bill.

Senate concurs in House budget!

Shortly before 4:00, the Senate took up a motion to concur in the House changes to Senate Bill 572, the budget passed by the House last week.

As the debate began, Rep. Kevin Yoder (R-Overland Park ) had called in the Appropriations Committee with the intent of creating another O’Neal/Yoder budget. Clearly the Senate decided to move ahead and perhaps cut that effort off at the pass.

The debate was brief and at 4:15 it was announced that the Senate had indeed voted to concur in the House budget on a vote of 21 to 17. The budget is now passed. The next action will be watching for is a motion over in the House to concur in the Senate’s tax bill.

House pulls all-nighter

Debate ends in big win for Dem/Mod coalition

The House “worked” from 9:00 am on Friday until about 4:00 am Saturday with a coalition of Democrats and Moderate Republicans fighting to protect Kansans from those who sought to shrink government to a size that can be drown in a bathtub.

Bill Feuerborn (D-Garnett) took the lead in the effort, working calmly and deliberately through 13 amendments that removed the Yoder budget from SB 572 and replaced it with the Coalition plan. After a short break, the O’Neal/Yoder contingent began a long process of offering amendment after amendment to either punish certain Kansans or embarrass the Coalition.

The “postcard” amendments included several attempts to increase funding to eliminate waiting lists for those with developmental or physical disabilities. Under the Coalition budget, some relief is brought to these Kansans but many will still be on waiting lists for services. Mike Kiegerl (R-Olathe) offered an amendment to eliminate the waiting lists and when asked how it would be paid for said, “Just raise taxes some more!” Given Kiegerl’s support for tax proposals in the past one wonders how he would justify his motion and a later vote against providing the funding. Anthony Brown (R-Eudora) proposed taking millions of dollars out of the state employee pay plan to pay for these services. You can bet that these votes will show up on campaign postcards this fall as conservatives try to portray themselves as compassionate.

Other amendments were simply put up to keep people from going home or to pander to anti-government groups. Anthony Brown (R-Eudora) offered an amendment to bring the new Arizona immigration law to Kansas. This was dropped when it was deemed to be not germane to the budget bill. It was one of three amendments tossed out because one cannot put policy changes in a budget bill. Kasha Kelley (R-Arkansas City) tried to put mandatory drug testing of all recipients of social welfare programs, arguing that they were using state benefits to buy drugs.

All told there were over 60 amendments including the 13 needed to get the Coalition plan into the budget in the first place. And each and every vote demonstrated that the Coalition was strong and would not be broken up. They developed a bipartisan plan to protect education, respect state employees, and bring at least some relief to the disabled, seniors, and other state services. Once they had their plan, they demonstrated the discipline to stick to their guns even when tempted to take some “postcard” votes.

And shortly after 3:00 am, 71 Coalition members stood together to advance the budget. A final action vote will come some time today, probably shortly after they reconvene at 1:00 this afternoon.

In a final bit of action, a motion was made and adopted to bring SB 74 up onto the debate calendar. The intent is to use this bill in an effort to run the KPERS employer contributions through school district general fund budgets. This action would allow school districts to levy some additional local authority to offset some of the state reductions in school aid. Look for this to happen today as well. It is likely that this effort will be supported by the full Coalition but its fate is unknown in the Senate where the same idea was recently defeated. Of course, minds sometimes change.

What’s on tap?

First order of business in the House is final action on the budget. After that they will act on SB 74. That action will likely be followed with a motion to concur in HB 2360 that contains the tax plan already passed by the Senate.

Over in the Senate, there could be a motion to concur in SB 572, the new House budget. If SB 74 passes the House, it will get a second chance in the Senate.

If Democrat/Moderate Republican coalitions in both chambers hold together, we just might make it out of the 2010 legislative session with no more damage! And if things go smoothly (though they seldom do!) it could all be over late tonight. Everyone wants to be home for mom!

Part 2

House passes budget on final action

Coalition stays strong

The House this afternoon passed Senate Bill 572, the budget bill that contains the Democrat/Moderate Republican coalition budget. This budget stops additional cuts to K-12 education but is dependent on the adoption of a tax plan that the Senate has already passed. That tax plan will be available for a vote to concur in the House today. SB 572 goes over to the Senate now where there may be a vote to concur.

KPERS pass-through

After adopting the budget, the House took up Senate Bill 74 which contained the proposal to pass KPERS employer contributions through the school district general fund budget. This, if adopted, would allow the LOB to be calculated against a higher general fund budget generated more local funding.

The KPERS pass-through was particularly important to the Johnson County delegation that has long sought additional local authority.

On the first amendment, Education Committee Chairman Clay Aurand (R-Courtland) tried to delete the KPERS pass-through from the bill. This amendment failed on a vote of 54 to 68.

A second amendment by Sheryl Spalding would change the pass-through so that it would allow a district to choose to take the extra LOB funding for one year. In the second year to continue using this authority, there would need to be a vote of the district residents. In addition, the state would equalize this new LOB authority beginning in the second year. This amendment was adopted on a vote of 83 to 38.

The next amendment came from Bob Brookens (R-Marion) would allow for some new flexibility in spending leftover funds in various accounts. This amendment was adopted on a vote of 76 to 40.

An amendment by Bill Otto (R-LeRoy) would allow districts to put up to 20% in contingency reserve – an interesting idea when so many legislators are demanding that school districts should not have as much as they do now in reserves. There has been plenty of talk about funding budget gaps and how school district reserves could cover them. And yet, this amendment passed on a voice vote.

Lance Kinzer offered an amendment to allow a quarter-cent county sales tax for schools. This has been killed on the House floor twice before this year. And once again the proposal failed. This time on a vote of 35 to 83.

Lana Gordon came to the well next to once again offer her school district uniform accounting systems. This amendment was put on the budget bill last night. This time it failed 54 to 65.

Forrest Knox offered an amendment to require schools to be paid on time which we suppose will work unless the state comes up short of money! The amendment passed 104 to 17.

The bill was finally advanced to final action on a vote of 63 to 59.

The bill will still need a final action vote before it can be sent to the Senate (if it passes).

Part 3

House, Senate say NO to second all-nighter

They’ll be back on Monday

The House and Senate had been planning – or so it was said – to pull another all-nighter in the hopes of ending the 2010 session but had a change of heart after a bite to eat.

Each chamber having dispensed a couple of controversial items (day care issues in the Senate, KPERS pass-through of LOB in the House) they broke to grab a quick bite, indicating that they would be back. The House planned to be back in at 8:30, the Senate at 9:00. And while the lobbyists were back, milling about outside the chambers, prominent Senators and Representatives were dashing back and forth clearly in negotiations/conversations about how to proceed.

About 10:00, the House reconvened and quickly adjourned until Monday morning at 11:00 am. The Senate did likewise, setting a 2 pm Monday return time.

The House budget now sits in the Senate available for a vote to concur unless leaders decided to put the two budget bills in conference (the Senate bill sits in the House awaiting action). The House has advanced SB 74, KPERS pass-through school finance, and must vote on that on final action. They also have the Senate tax bill awaiting House action – it sits “on the table” in the House. The Senate is waiting for the House to deal with those two issues before proceeding.

The big question is how long they will be in session next week. There is a widespread belief that, if they return on Monday, they stay until Friday. This year, however, just might be different.

See you all Monday!

House debating budget

Thirteen parts to get through

The House is in the midst of what might be a long debate. The Feuerborn amendment, which puts the budget crafted by the Democrat/moderate Republican coalition into the House budget bill, has been divided into 13 parts each of which must be debated and voted on individually.

At this point they have passed the first four parts with solid majorities. Conservatives are putting up a fight but the coalition is holding tight, delivering about 70 yes votes on each part of the budget.

The coalition hopes to pass each of the Feuerborn amendments and block any additional amendments so they can send their budget over to the Senate for a vote to concur.

We’ll be watching until the end!

Part 2

House: All Feuerborn amendments pass

But it’s not over yet!

The House finished debate and voting on all thirteen parts of the Feuerborn budget amendment, passing each one with a solid majority. As soon as the last one was adopted, they broke for a brief lunch and opportunity to caucus.

When they return this afternoon, it will be time for amendments to the new budget bill to be offered. We’ll be watching for proponents of more cuts to begin offering “compassionate” amendments that will balloon the cost of the bill. Their goal will be two-fold:

1.       Load the bill up with expensive amendments that will cause it to be defeated and

2.       Gather a bunch of “postcard” votes to use in campaigns in the fall.

The coalition partners will have to exercise a lot of discipline to keep the budget within the parameters of the tax bill passed by the Senate last night

Part 3

House: Coalition holding firm

But it’s not over yet!

The House Coalition budget is crawling through amendment after amendment, debating, arguing, and voting. At 11:00 pm we are up to 46 amendments, nearly all of which have failed and most of which are offered to get a good campaign issue for a postcard. Votes are indicating that the Democrat/moderate Republican coalition is holding firm and working to wait out the conservative amendment onslaught.

As soon as it looks like the list is close to an end, another three or four lights go on indicating someone wants to speak – and probably bring up an amendment. Virtually every amendment is being subjected to a roll call vote. Everyone wants everyone else “on the record.”

We’re letting you know now that this will be our last report for tonight. We’ll be back at work under the dome tomorrow.

House in, House out, House in, House out, House in

Budget debate finally starts at 1:45

The House came in this morning at 8:00 am and almost immediately recessed until 11:00. They returned shortly before noon and again recessed until 1:30. They returned again at 1:30 amidst rumors that they might not take up the budget today. But indeed, they have finally begun debate.

House leadership has divided the Feuerborn amendment (a new and more responsible budget) into 13 parts, each of which will be debated and voted on separately.

At this moment Kevin Yoder (R-Overland Park ), author of the “Yoder budget” that focused on cuts to state agencies, is grilling Rep. Bill Feuerborn (D-Garnett), author of this amendment which eliminates the entire Yoder budget and replaces it with a budget the preserves services for Kansans.

As we’ve been saying for the past few days, this looks to be a long night!

Part 2

Senate passes tax package to support budget!

Seven-hour debate ends in win for Ways and Means leaders

The Senate, at about 9:40 tonight, approved a tax increase package that will support the budget they adopted last night. It’s beginning to look like the session is coming close to the end.

A long series of amendments were proposed and most defeated. Some of the adopted amendments reduced the overall size of the tax package but there was some breathing room in it and it appears to support either the Senate budget or the Feuerborn amendment to the House budget now being debated.

One reduction was the removal of the one change to business. The bill contained a decoupling from one section of the federal tax code, which would have cost some business interests a total of about $17 million in tax breaks. This was pulled out of the bill on a motion by Sen. Tim Huelskamp (R-Meade).

Another amendment by Sen. Bob Marshall (R-Fort Scott) provided that the new sales tax increase would not apply to any construction contract signed by May 1, 2010. This will reduce receipts from the sales tax increase by about $15 million.

The third amendment to reduce money was one by Jean Schodorf (R-Wichita) that increases the earned income tax credit (EITC) for the working poor from 17% to 18%. This will cost about $4.2 million but will help to offset the sales tax increase for Kansans with very low incomes.

Sen. Roger Reitz (R-Manhattan) tried to put a cigarette and tobacco tax increase back in the bill but his amendment got only three votes.

On the controversial side, an amendment by Sen. Mary Pilcher-Cook (R-Shawnee) to remove the sales tax exemption on abortion services (all medical procedures have a sales tax exemption) failed on a vote of 17 to 22 while an amendment by Sen. Terry Bruce (R-Hutchinson) to establish a sales tax holiday for one week in July on the sale of firearms initially passed but was reconsidered and defeated on a vote of 20 to 20.

At about 9:25 the motion was made to advance the bill to final action. When that passed on a voice vote, a motion was made to immediately take the final action vote. The tax bill was adopted on a vote of 23 to 17.

Senator Ralph Ostmeyer (R-Grinnell) explained his yes vote by telling his colleagues that, although he had never voted for a tax increase before, this year was different. He had traveled from one end of his district to the other and met with record numbers of his constituents who were pleading with him to raise their taxes to save their services. Let’s hope those same constituents will now give Senator Ostmeyer their thanks. They made themselves heard and he listened.

What’s in store now?

The Senate has passed both a budget bill and a tax bill. They put those plans in House bills so it is conceivable that, when they make their way over to the House, there could be a motion to concur in the Senate amendments to the House bills. Should that happen, the session would be essentially over.

But the House began a debate this afternoon on the “Feuerborrn” amendments to the House budget bill. The House had earlier voted not to advance the Yoder budget that depended on cuts to balance the budget. In response, Rep. Bill Feuerborn (D-Garnett), working with other Democrats and moderate Republicans, crafted a massive amendment – a completely different budget plan – to be presented as a “gut and go” amendment. Under this scenario, the amendment completely deletes everything in a bill and replaces it with new content. The “Feuerborn amendment” would replace the “Yoder budget.”

House leadership divided the Feuerborn amendment into 13 parts each of which must be debated and voted on separately. If successful, this will create a good House budget that could be supported by the just-passed Senate tax bill.

Since the House budget is in a Senate bill, it could be sent to the Senate for a simple vote to concur. In that happened and the House concurred in the Senate tax plan, the session would be essentially over.

The House goes in tomorrow at 9:00 am to continue the debate on the Feuerborn amendments. They stopped tonight at 5:00 so Representatives could pay their respects at a funeral service for the mother of Rep. Gene Vickrey (R-Louisburg).

The way things have gone so far over in the House, we again anticipate that the debate will be long and contentious.

House comes back in, adjourns for the night

Budget delayed

The House came back from their extended recess and was expected to begin debate on a new budget but after a lengthy delay it was announced that the bill was still be proofed and that it would take a long time to finish. Rather than keep the House in any later, leadership adjourned for the evening at about 7:00. They will be back in tomorrow morning at 8:00 am.

Senate debates, approves a budget

In the meantime, long debates went on over in the Senate on a school bill dealing with transportation between districts and on the budget.

An amendment to the transportation bill offered by Karen Brownlee (R-Olathe) would pass the KPERS employers contributions through school district general fund budgets which would boost the budget upon which the LOB is calculated. This amendment failed on a vote of 16 to 22.

On the budget bill, Senator Ty Masterson (R-Andover) again tried to cut education funding and tied his amendment in with another attempt to sell off state property. This amendment failed on a vote of 12 to 28.

Senator Jim Barnett (R-Emporia) offered a legislative pay cut for the next two years. After some spirited debate this amendment failed on a vote of 14 to 26. This is the amendment likely to garner the most press!

Senator Tim Huelskamp (R-Meade) offered an amendment containing a TABOR-like tax and expenditure limitation. TABOR of the Taxpayer Bill Of Rights is a way to slowly starve government. It is intended to fulfill Grover Norquist’s promise to “shrink government to a size that can be drown in a bathtub.” This amendment failed on a vote of 15 to 20.

In the end the bill was advanced and approved on final action on a vote of 23 to 17.

House back at 8:00 am tomorrow; Senate at 11:00 am.

House votes not to advance budget bill

The House stayed until 10:00 pm last night debating amendments to the Yoder budget that reduces school funding by $86 million and, in the end, voted it down on a vote of 45 to 74. During the course of the debate, the House took a couple of short recesses that turned in to hours. Speculation about what was going on ran from drafting amendments to arm-twisting to trying to cut deals with moderate Republicans to just not letting people believe they had enough time to go get a bite to eat. Whatever the reason for the delays, they did not help build support for the Yoder plan.

A late motion by Marvin Kleeb (R-Overland Park) would have sold off state property to eliminate Yoder’s $86 million school funding reduction. This would have filled the hole one year and opened it back up again the next. The move was apparently an attempt to bring public school supporters on board. It didn’t work. The amendment was voted down 56 to 64.

The bill still sits on the calendar and can be brought up again. It is thought that there might be a move to bring it up again with the intent of gutting it and putting in new budget that protects state services.

The Senate chose to not debate their budget bill yesterday and will take it up today. This is likely to be a very long day in both chambers. Pay for legislators runs out today forcing them to choose to go for a long night and wrap things up or make what will be a very unpopular vote to pay themselves to continue.

House gavels in, recesses

Budget stirrings

The House went on the floor this morning, handled a couple of resolutions, and the recessed until 3:30 this afternoon. It appears that there is movement afoot in the House to put forth a new budget crafted by a coalition of Democrats and moderate Republicans to replace the Yoder budget that was defeated last night.

The coalition budget is likely to be very similar to the one crafted by the Senate Ways and Means Committee on Monday. Since it will be put into Senate Bill 572, it can be sent to the Senate for a simple vote to concur which would send the budget to the Governor.

If that happens, the only big thing left will be to assemble a tax package to support the budget. In this case, since the Senate Ways and Means Committee has already put such a package in a House bill, if it can pass the Senate it would go to the House for a vote to concur.

These actions would avoid a contentious conference committee that would have Republican moderates in the Senate (Jay Emler and Carolyn McGinn) squared off against Republican conservatives in the House (Kevin Yoder and Ray Merrick).

This could be a long night!

Senate kills attempt by Ty Masterson to cut student weightings

During Senate debate this morning, Senator Ty Masterson (R-Andover) offered an amendment to cut student weightings by 17%. Included in his amendment was some flexibility to spend some funds and moving the KPERS employer contributions through the school district’s general fund budget to levy additional LOB authority. We’re not sure why Masterson thought it a good idea to cut an additional $85 million out of student weightings but the amendment could only get 12 supporters – far short of the majority needed to adopt it.

Education Conference Committee works higher ed bills

The Conference Committee for Education met this morning to consider Higher Ed Bills SB 485, SB 416 and SB 131. SB 485 would raise the fees charged to out of state Higher Education entities that offer On-line Classes and Degrees.  The fees would bring the state into line with the fees charged by other states for Kansas Higher Education entities to offer On-line Classes and Degrees in their states. The conference committee tentatively agreed to raise the fees with a one year sunset provision so the fee structure can be evaluated at that time. The provisions of SB 416 were discussed which would end the need for Higher Education employees to fill out Statement of Substantial Interest forms. The costs to the state to receive, review and file the statements are significant and according to testimony, the statements are rarely if ever reviewed. These two bills will be put into SB 131 which, as amended, would allow the governing body of a technical college to change the name of the college by adopting a resolution.

The bill also would direct the State Board of Education to establish an Early High School Graduation Incentive Program. Students in public high schools who graduate at least one year earlier than the usual time would be eligible for up to $3,000 to be used for fees and tuition for attendance at a Kansas technical college or community college. The State Board of Education may adopt rules and regulations necessary to implement the Program. The Senate and House conferees reached a tentative agreement and will meet again to sign the Conference Committee report.

The Senate will reconvene at 2:00; the House at 3:30.

House budget debate ongoing

The House is in a brief break and will be back in at 5:00 to continue the budget debate. There have been multiple amendments offered most of which have failed. We are waiting now on a few more to be delivered.

One amendment that concerned us was offered by Lance Kinzer (R-Olathe) to repeal in-state tuition for the children of undocumented workers. This amendment has been before the House many times and never passed. This time it went down on a vote of 50 to 70. KNEA, KASB, USA, the Board of Regents and many other organizations oppose attempts to deny these children access to post-secondary education.

Another amendment offered by Peggy Mast (R-Emporia) would have prohibited state money from being paid to the Association of State, County, and Municipal Employees (AFSCME) for employee training. AFSCME offers excellent professional training opportunities for many state employees. This amendment intended to harm the “union” was defeated on a vote of 47 to 70.

We’ll be here into the night watching and wondering! The House still has to take up at least the tax bill since their vote yesterday was to continue that debate today. If it looks like things are going to go on for a long time, perhaps they will vote to postpone that debate yet again.

The Senate has not taken up their budget or tax bills yet today.

Worth quoting!

In arguing against the House budget bill, Rep. Ann Mah (D-Topeka) told the body, “You can’t have government small enough to drown in a bathtub and big enough to pull your behind out of a flooding river!”

Education Conference Committee at a stalemate?

Senate makes a “final” offer

The Education Conference Committee met and, after a few rounds of back and forth, the Senate handed over what was characterized as their last offer.

As with all conference committee reports, this one is likely to contain a number of provisions passed by one chamber or the other. Among the provisions of the Senate’s last offer are:

The contents of HB 2704 allowing multiple school districts to consolidate into a number of larger districts,

The contents of SB 354 which deals with the levying of the cost of living and extreme declining enrollment provisions against automobiles – this fixes a situation where a levy brings in more money that allowed under the statutes,

It would enact a linear transition for high density at-risk funding when the base state aid per pupil reaches the statutory level,

It runs KPERS contributions through the district’s general fund which boosts the amount collected under the LOB since it increases the general fund (but gives no additional state funding for instruction).

The House negotiators have not accepted this position but the Senators seemed to suggest that they were not interested in further negotiations. We’ll see.

House Ed Budget Committee finds new way to increase LOB money

The House Education Budget Committee while working HB 2748 – a bill giving more flexibility to transfer and spend balances in various accounts – inserted a big change to the school finance formula by allowing the state’s KPERS employer contributions to run through the school district’s general fund thereby increasing the general fund upon which the LOB is based.  A district’s LOB would then be the same percentage applied to a larger budget. This naturally results in a local property tax increase (in a year when House members are spending an awful lot of time decrying tax increases).

It is unknown if the state will kick in the money required to equalize this additional authority. If the state doesn’t provide such funding, LOB aid would have to be prorated. 

These changes were then put into Senate Bill 74.

Full House debates sales tax exemption bill…again

The Full House once again took up HB 2549 the sales tax exemption bill that they had begun debating back in mid-March. At that time they gutted virtually everything in the bill and then adopted a motion to set the bill aside and take it up again on May 3.

An attempt by Anthony Brown (R-Eudora) to insert the Senate’s tax package into the shell of the bill failed on a unanimous vote. This is exactly what legislators like Anthony Brown wanted to do. It allows them to say there is no appetite for a tax increase so they can push deeper cuts in the budget.

A number of other amendments failed including one by Lance Kinzer (R-Olathe) to allow each county to levy a one-quarter cent sales tax for the schools in that county.

After a lengthy debate, the House adopted yet another motion to set the bill aside and revisit it on May 4!

Senate Ways and Means adjusts budget and tax bills

With news that there was yet another decrease in state revenues – $65.3 million less than expected – the Senate Ways and Means Committee went back to work to redo both their budget and tax bills.

In adjusting the budget, the Committee decided to go ahead and count on some money that might come in or might not. They found $28 million in expected casino fees; $131 million in possible federal Medicaid money if Congress expands a temporary increase in the Medicaid match, and a maybe $27 million in Medicaid fraud collections. This “provides” about $183 million in possible money, allowing the Committee to fund the budget with the additional hole and still let them reduce their tax bill.

So that’s just what they did! They came back in about 7:30 and made two significant changes to the tax bill. They moved the sales tax start back to July and eliminated the cigarette and tobacco products tax increase.

So once again the bills combine to bring the State back to zero at the end of the year. Unless, of course, revenues should decline an inch or so more in the meantime.

Committee work was done at 8:00 pm.

Could be a long day in the House

Budget, School finance changes, Taxes up for debate

It looks to be a long day in the Kansas House where the first three bills up for debate are House Substitute for SB 572, the Yoder budget; House Substitute for SB 74, flexibility in spending unencumbered funds and running KPERS employer contributions through the district’s general fund; and House Bill 2549, the tax bill that was put off yesterday for continued debate today.

By noon, the House had begun the budget debate and adopted the first amendment before recessing for lunch. The amendment by Representative Arlen Seigfried (R-Olathe) calls on the Department of Administration to inventory state real property with the idea that the state can sell some of it off. The amendment was adopted on a vote of 79 to 44.

The House comes back in at 1:30 to continue the debate.

Senate in and out

The Senate came in at 10:00 but recessed without taking any action. They will return at 3:00.

This action calls in to question whether or not they will get to their debate calendar today. Up for debate are both Senate Substitute for HB 2360, their tax increase bill, and Senate Substitute for HB 2631, their budget bill. It could be that, since both bills were pulled back and amended by the Ways and Means Committee last night, they want to give Senators time to digest and discuss the latest versions. Of course, it is still possible that they will go on into the night in debate.

Senate drafts tax bill

Ways and Means Committee packages just enough money to come out even

The Senate Ways and Means Committee, having moved out a budget for the remainder of this year next year that had a $418 million revenue shortfall, worked to craft a tax bill to fund it.

Included in the bill passed out of committee is the Governor’s one cent sales tax increase but advanced by one month to help in this fiscal year, and the increase in cigarette and tobacco taxes. These ideas have been floating out there since the session started.

To get the package up to the necessary $418 million, they added a provision decoupling one section of the Kansas tax code from the federal tax code. This action would provide a federal tax cut but block the application of that tax cut to the Kansas tax code. It is a new federal tax credit for corporations and 94% of it applies to corporations with over $100 million in assets. Most Kansas businesses would see no benefit from the credit.

The package also includes an expansion of the state food sales tax rebate program. This reduces the package somewhat but provides critical sales tax relief to low income families partially offsetting the sales tax increase for very low income Kansans.

A couple attempts were made to amend the package. A motion by Senator Pat Apple (R-Louisburg) to exempt construction projects under contract prior to June 1 from the sales tax increase was withdrawn but will likely be reconsidered during floor debate. Senator Mark Taddiken (R-Clifton) moved to drop the federal tax decoupling. His motion was defeated on a vote of 4 to 8. A motion by Senator Kelly Kultala (D-Kansas City) to change the tobacco products tax from a retail to wholesale tax was also defeated.

In the end, the bill was moved out of committee with four Senators (Ty Masterson of Andover, Jean Schodorf of Wichita, Apple, and Taddiken) voting no and asking to be recorded as voting no.

The bill now moves to the full Senate for debate. It is likely that the budget bill will be voted on first. If that passes, then it will be necessary to pass the tax bill. Look for this to happen early this week.

OOPS!

It was enough when they voted it out, but later that day…

While the Ways and Means Committee sent out a balanced budget/tax package by early afternoon on Friday, by the end of the day their package was out of balance!

Revenue collections for April were another $65.3 million below projections meaning they still need to come up with that amount just to get to zero.

The calendar for the day indicates that the budget and tax bills could be debated but we imagine they may regroup and try to deal with this new information before proceeding.

Senate drafts tax bill
Ways and Means Committee packages just enough money to come out even

The Senate Ways and Means Committee, having moved out a budget for the remainder of this year next year that had a $418 million revenue shortfall, worked today to craft a tax bill to fund it.

Included in the bill passed out of committee this afternoon is the Governor's one cent sales tax increase but advanced by one month to help in this fiscal year, and the increase in cigarette and tobacco taxes. These ideas have been floating out there since the session started.

To get the package up to the necessary $418 million, they added a provision decoupling one section of the Kansas tax code from the federal tax code. This action would provide a federal tax cut but block the application of that tax cut to the Kansas tax code. It is a new federal tax credit for corporations and 94% of it applies to corporations with over $100 million in assets. Most Kansas businesses would see no benefit from the credit.

The package also includes an expansion of the state food sales tax rebate program. This reduces the package somewhat but provides critical sales tax relief to low income families partially offsetting the sales tax increase for very low income Kansans.

A couple attempts were made to amend the package. A motion by Senator Pat Apple (R-Louisburg) to exempt construction projects under contract prior to June 1 from the sales tax increase was withdrawn but will likely be reconsidered during floor debate. Senator Mark Taddiken (R-Clifton) moved to drop the federal tax decoupling. His motion was defeated on a vote of 4 to 8. A motion by Senator Kelly Kultala (D-Kansas City) to change the tobacco products tax from a retail to wholesale tax was also defeated.

In the end, the bill was moved out of committee with four Senators (Ty Masterson of Andover, Jean Schodorf of Wichita, Apple, and Taddiken) voting no and asking to be recorded as voting no.

The bill now moves to the full Senate for debate. It is likely that the budget bill will be voted on first. If that passes, then it will be necessary to pass the tax bill. Look for this to happen early next week.

Guest Column

We couldn’t have put things any better so today we let State Representative and retired KNEA member Ed Trimmer (D-Winfield) fill you in on what’s at stake in this veto session

This week the Kansas Legislature will reconvene to begin what looks to be a very difficult budget process, to say the least.  It is important that members of the House and Senate keep an open mind to the issues at hand and not retreat to ideological positions that make negotiation impossible.  Working with members of both parties and considering all options will keep the Kansas Legislature from becoming a microcosm of the U.S. Congress.  Legislators need to make sure they try to do what is best for all Kansans but with the knowledge that they will not make everyone happy

Recent forums have sparked some controversy and it is important that local legislators learn from what the public is saying.  It is also important that we all evaluate the sources of data on which we make decisions.  The following issues appear to be central to the budget controversy we are experiencing in our state

Revenue increases vs. budget cuts – There is no question that our economy has had problems or that unemployment is one of the most important concerns facing many Kansans.  It is also important that budget solutions do not impose unreasonable burdens on the unemployed or low-income individuals.  However, if we do not find a way to close a $510 million deficit for the remaining portion of 2010 and fiscal year 2011 our local prisons, schools, veterans programs, agencies for the handicapped, home and community based services, municipalities, and infrastructure could suffer considerably.  This would not only contribute to loss of services for the local economy and significantly affect the quality of life for many individuals, but would also add significantly to the unemployment problem. 

Recently we have been hearing that university economists have been claiming that a sales tax increase to cover the budget deficit would cost the state jobs.  Here is a little more information on the issue

• Economist Art Hall has claimed that the state would lose 19,000 jobs with a one-cent sales tax.  This number has seemed to increase as the spring progresses.  It has been stated recently by local legislators that the number is either 23,000 or 26,000.  Kansas University Chancellor, Bernadette Gray-Little, recently noted that Art Hall does not represent the University of Kansas.  He is a non-tenure track professor who heads the Center for Applied Economics funded by the Fred C. and Mary R Koch Foundation.  It is also important to note that the methodology he used to arrive at the 19,000 figure is unclear in light of empirical examples and that his work is not subject to review by the economics or business departments at the University of Kansas.
• John D. Wong, Ph.D., Interim Director of the Hugo Wall School of Urban and Public Affairs, Professor at Wichita State University, and a member of the Kansas Consensus Revenue Estimating Committee recently published a report for the Economic Progress Council.  In the report he used the IMPLAN3 economic impact assessment tool as a part of the study’s methodology. He found that a $350 million reduction in state revenues would result in the loss of 5,177 jobs across the state.  A one-cent sales tax would at worst result in the loss of 3,231 jobs statewide.  Using a one-cent sales tax to generate $350 million in revenues would result in a net SAVINGS statewide of 1, 946 jobs.  It has also been noted that previous sales tax increases imposed at different levels of government including the increase for the new arena in Wichita, have not shown the extreme job loss predicted by Art Hall.

I am not suggesting that a one-cent sales tax is the only option, but it is certainly non-productive to say that any tax increase, including temporary ones, are off of the table.  The impact of massive budget cuts demands we look at all alternatives

Government vs. business – There is no question that businesses are essential to a community’s economic health.  It is fair to argue that businesses are the cornerstone to economic well-being.  But to argue that government has no constructive role to play is shortsighted.  Government provides services that would be impossible or unfeasible for private enterprise to provide. 

It was recently stated in a letter to the editor in the Winfield Courier, that tax increases are “an anathema” to economic development.  This would indicate that the sales tax approved by Winfield citizens years ago for community improvement have been bad for economic development.  We built a public golf course, a swimming pool, and a sports complex with the money.  I would argue that people who come to Winfield, play golf, swim, and attend sporting events contribute to our economy.  We have held numerous state tournaments and youth events at these facilities.  I have noticed a number of busses frequenting our local eating establishments and out-of-town cars parked in front of local stores.  I believe any economic development director would agree that improving a town’s image and bringing in outsiders for events is good for the economy.

Our local non-profit organizations are a successful example of privatization of services for the handicapped.  Putting them out of business would not be good for the local economy.  Many businesses rely on purchases from the school district, the city, the county, and from many of the government agencies and programs in the area.  Government employees pay taxes, spend money in the community, and contribute to the communities in which they live.  In fact, one of the most notable parts of the Wichita State University economic study is that money from state and local sales taxes are spent in Kansas on programs for Kansans.   

We should not overburden businesses to the point they fail to thrive, but giving away billions of dollars to large corporations that take a large amount of income out of the state does not help our local businesses either.  We need to focus our economic incentives on small businesses and require more transparency to guarantee the incentives are used to promote job growth.

Education vs. other programs – It is not fair or productive to pit K-12 education against other social programs.  All programs have seen massive cuts already.  To say that public education has only taken a 3.5% cut is also misleading.  The cuts have been much closer to 9% or more.  Many of the cuts have taken place during the last two quarters of the year.  Those who would pit veterans programs, home and community based services, programs for the handicapped and public safety against education want to divert attention from the real issue of funding all programs.  Many of these same individuals do not believe that programs for the handicapped, elderly, veterans, and the poor are the responsibility of government and do not include them in what they consider “Core Responsibilities of Government.” 

No tax vs. tax shift - Some legislators have promised a balanced budget with no cuts and no tax increases.  We must understand that “no cuts” can mean “shifting the tax burden to the local level.”  During the past ten years, more and more of the tax burden for schools has been shifted to the local mill levy.  Tax breaks for businesses have been enacted at the state level but have reduced revenues at the local level.

In the House, there is an education-funding bill that would provide some funding for public education but do it by shifting 20% of equalized funding to the local level.  This is fine for rich districts, but it would mean about a 12 mill property tax increase for Winfield, a 19 mill property tax increase for Central Burden, a 17 mill property tax increase for Arkansas City, a 15l mil property tax increase for Udall, and an 8 mill property tax increase for Leon.  It is not really a question of no tax, but who pays the tax. 

Other funding sources – The Legislature should certainly look at all possible revenue sources and taxes are not the only way to fund programs.  Legislators must always look to cut waste, but recently the proposals from the legislative budget committees, especially the conservative dominated House Appropriations Committee have only recommended across the board or targeted agency cuts.  It appears that waste in government is an easy and popular claim to make but not as easy to find and remove.  If there is plenty of waste in government, then the Conservative controlled leadership should be able to find it and spare important programs.  That has not been the case for the past six rounds of budget cuts.

I agree that the State of Kansas has assets but it is not accurate to say that all of them could be sold and that their sale would benefit the state.  I am not sure how selling a building and then paying rent to a private entity would save money or leasing the turnpike would improve rates or road repair.  Much of the land owned by KDOT is right-of-way that either has no access or cannot be used commercially.  We will know more about state assets after July 1^st 2010 when the agencies will have their data compiled.  That will not be in time for this legislative session, so to suggest it is an answer for this year’s deficit, is not realistic.

Interest groups – A few interest groups claiming to be research organizations or public advocacy groups have been spending a great deal of money to influence public opinion.  Full-page ads in local newspapers all over the state are expensive.  It has been widely speculated that most of the funding for these few groups comes primarily from one source.  These groups are especially active during elections but fight attempts to reveal their sources of funding.  It makes one wonder.  If these groups are truly just organizations who want to protect the public, why do they fight so hard to keep the funding behind their efforts a secret?

When legislators head back to Topeka, this week it is more important than ever that we look at all ideas and are not too quick to take immovable ideological positions.  We need to arrive at the best solutions possible and that will take wisdom, compromise and patience. 

Kansans for Quality Communities calls for tax increase in capitol press conference

The state-wide coalition Kansans for Quality Communities (KQC) held a press conference in the capitol today at which they called upon legislators to pass a tax increase to support vital state services and keep Kansas communities strong.

Speaking at the press conference were KNEA lobbyist Mark Desetti, Kansas Organization of State Employees Executive Director Jane Carter, Statewide Independent Living Council of Kansas Executive Director Shannon Jones, InterHab Assistant Executive Director Matt Fletcher, and Kansas Families for Education Executive Director Kathy Cook.

Said Desetti, “The people of Kansas have elected their legislators to put the needs of all Kansans ahead of political expediency or ideology. Today more than ever, we are in need of a legislature that can set aside partisanship and demonstrate a spirit of collaboration and cooperation in the quest to preserve and ultimately strengthen our state and our communities.”

KQC pointed to hopeful signs that more Kansans were ready to take up the banner for strong, vibrant communities in every corner of the state. Noted was the study released by the Kansas Economic Progress Council demonstrating that more cuts to state services had a more negative effect on jobs in Kansas than a tax increase.   The study was conducted by economist John Wong of Wichita State University.   (Read the study by clicking here.)

Also noteworthy was the fact that 16 local chambers of commerce have broken ranks with the state chamber in calling for a tax increase to preserve public education, roads and highways, and the social service safety net.

Members of the coalition told the press that just as Kansans could count on the highway patrol responding to an accident and could count on the school doors being open to children every morning, service providers want to see a budget they can count on.

Read the full statement from Kansans for Quality Communities by clicking here.

Post Audit releases two more “efficiency” studies

The Legislative Post Audit released two more school district efficiency studies this morning. Today’s releases cover USD 267 Renwick and USD 465 Winfield.

Prior audits of efficiency in education, ranging from examinations of individual K-12 districts to Universities tend to suggest changes simply to cut spending but not particularly focused on students.

Like the previous studies, the focus of recommendations in these two is essentially to cut costs by dropping block scheduling and closing buildings. In Renwick, they suggest the possible closure of one elementary school and Garden Plain High School saving about $1.5 million. In Winfield their suggestions include closing Country View Elementary and Winfield Intermediate Schools at a savings of about $1.4 million.

Both studies also suggest ending block scheduling and returning to a traditional teaching schedule. They estimate that doing this would save $95,000 in Renwick and $154,000 in Winfield. If they were to eliminate block scheduling and reduce the number of class sections offered (dump the low enrollment classes) Renwick could save an additional $288,000 while Winfield could save an additional $129,000. These savings are achieved through staff reductions.

KNEA believes that we should not be mistaking “cheap” for “efficient” which the studies often appear to do. For example, the post secondary study went so far as to suggest dropping low-enrollment courses. While it might be appropriate to drop courses that almost no one takes and are not tied to a college major or certification program, others are critically important. For example the study of a Slavic language might draw far fewer college students than the study of French or Spanish but it might be critically important to students of international relations.

On the K-12 level those low enrollment classes are often those taken by our highest achieving students such as advanced placement classes and those taken by students needing the most help such as tutoring and remedial programs.

Efficiency is not a measure of cheapness; it is a measure of effectiveness for the amount spent. The focus of all studies should be how students are doing, not is it cheap. This is the way school boards, school administrators, and teachers make decisions about class size, course offerings, and scheduling – will it improve student achievement? We should also point out that in another study on school spending conducted by the Legislative Post Audit they found there was nearly a one to one correspondence between increased funding and increased student achievement! Now that’s efficiency!

By every measure, Kansas is getting a real bang for its bucks.

Read the studies of Renwick and Winfield for yourself at this link: http://www.kslegislature.org/postaudit/audits_newest.shtml

Ways and Means: Day Three

The Senate Ways and Means Committee continued work for a third day today, moving through the last few agencies and on to a tax and revenue position to fund the gap.

Two education issues

In early work today, they looked at the Schools for the Deaf and Blind. At issue is the statutory requirement that ties salaries at those schools to the Olathe School District. Funding for the salary requirement was not put in the budget and the schools were asked to meet the requirement out of their existing budget.

There was some discussion about this but in the end, the Committee voted to take no action meaning the requirement to find the money out of existing resources stands. In addition, the Committee adopted a motion to introduce a bill in 2011 to repeal the statutory requirement on salaries.

Driver’s education was another topic today. On a motion by Sen. Lee (D-Kensington) the Committee took the money that was swept out of driver’s education to shore up the state general fund and moved it back to driver’s education. The motion also took after school program funds that were shifted to driver’s education and put them back in after school. So what this means is that most of the driver’s ed program is back to being funding as is the after school program. But, it conceptually makes an additional hole in the budget.

Budget bill finalized mid-afternoon

It was slow going but the Committee wrapped up work on the budget bill mid-afternoon but not before a small revolt overturned a proviso that had been put in the bill by Sen. Vratil earlier.

Vratil’s proviso that had been attached to certain appropriations in the bill where the Committee had increased funding said that if a tax increase sufficient to pay for the full budget bill was not passed, those increases would lapse. His intent was to apply pressure on legislators to support the accompanying tax increase for these popular programs. Legislators would know up front that one cannot vote for the increases and oppose the taxes.

Once the budget was wrapped up, Vratil indicated that the proviso – which had a blank in it where the size of the tax increase would be specified – would now include the number $412 million. This announcement caused several senators to question why the $412 million had to be all taxes and could not include other revenue sources such as increased federal funding.

After some discussion, a motion was made to change the proviso so that other revenue sources would count. A motion to replace the Vratil proviso with the new proviso by Sen. Laura Kelly passed on a vote of six to five. There is some question about whether this new proviso makes it easier to vote no on a tax package while speculating about other sources of revenue.

Tax bill started, ended without resolution

With the budget bill wrapped up, the Committee turned its attention to crafting a tax package to fund it.

The first order of business was to review the tax bills that had already had some play. These were the tax increase on cigarettes and tobacco products, the tax increase on sugary beverages, the tax increase on liquor, and the Governor’s sales tax increase.

Probably the most controversial of all is the sugary beverage tax which would increase the cost of a soda pop by as much as ten cents a can. The tax is based on how many teaspoons of sugar are in the beverage. With soft drinks ranging from nine to 14 teaspoons of sugar, the tax could be quite large.

Staff brought forth a long list of possible tax proposals that included various sales tax increases, income tax surcharges, different property tax proposals, a variety of tobacco and liquor tax increases, some tax restorations, and even new ideas on income tax brackets. This would give the Committee many options to consider and perhaps even allow them to pick a mix of proposals to reach the magic number.

There was some talk that agreement had already been made behind the scenes on a package that included sales tax, cigarette and tobacco taxes, and liquor taxes. Committee Chairman Jay Emler indicated that a “balloon” (a large amendment to a bill) had been drafted with these changes. The package would raise nearly $421 million for the state general fund and another nearly $22 million for the state highway fund in 2011 – enough to cover the budget gap.

It appeared for a moment that this was the way the Committee was going when it was asked if they would have a chance to meet and discuss other proposals. While that was not ruled out, the Chairman indicated that it was his intent to have both the budget and tax bills ready by the end of the week. More questions were raised about just how much money had to be in the bill – there is a gap for both 2010 and 2011 – and a 15 minute break was called about 5:20 in order to get a clearer answer from fiscal staff.

That break lasted until 7:00 pm when Chairman Emler returned to the committee room and announced that the Committee was adjourned until April 28.

So it appears that the wheels have fallen off the bus and it is pure speculation as to why that has happened.

Appropriations gets their chance beginning today

The House Appropriations Committee begins meeting at 10:00 this morning with the intent of crafting their budget bill.

We look for this meeting to be more about cuts and less about taxes than the Ways and Means Committee. So far the only thing we hear from House Speaker Mike O’Neal and Appropriations Chairman Kevin Yoder is that they intend to cut their way out of the budget hole.

How those cuts will happen is anyone’s guess but we anticipate that K-12 education has a big target on its back.

Ways and Means continues plowing through budge

The Senate Ways and Means Committee met for a second day, working their way through a massive list of items they had put off for omnibus consideration during their deliberations in the regular session. Well, it’s omnibus now, and they’ve got quite a list to go through.

Each agency in state government and each program in those agencies is subject to review and the work is tedious. Hopefully they can come out of these deliberations with a workable budget but early signs indicate a budget that is very, very lean and still cuts dangerously into the bone in many areas.

For example, restoration of services for Kansans with disabilities has challenged the committee. Far too many Kansans with disabilities have lost home and community based services and many of them may have no choice but to enter institutions. And those institutions are much more expensive than home services.

For the most part, the committee has rejected any additional funding and held the line on spending. By the same token, they have not proposed massive new cuts to make up the budget deficit.

This means that to balance the budget, there will have to be a tax bill to at least fill the gap. The Committee returns tomorrow with the intention of creating such a bill. The question is whether the tax bill will just fill the hole or if it will include restoration of any of the cuts enacted over the last year.

Might have been hard to fill a vending machine today!

If you were looking to fill your vending machines in Topeka this morning you might have been out of luck. The fifth floor of the capitol was awash in red and blue – red Coca-Cola shirts and blue Pepsi-Cola shirts – as the soft drink giants sought to keep Senators from considering a tax on sugary beverages.

Such a tax had been proposed in the Senate Taxation Committee but failed to go anywhere. Still, Coke and Pepsi are taking no chances. They even plastered “No beverage tax” stickers on the capitol vending machines. We wonder if this is a problem with the ban on signs in the capitol?

No action was taken on any taxes today.

Kansans for Quality Communities releases open letter to legislators

The coalition Kansans for Quality Communities released an open letter to members of the Senate Ways and Means Committee and House Appropriations Committee to let legislators know the impact of current and potential cuts on state services and the quality of life in Kansas.

In the letter, KQC called upon Kansas legislators to “act as good stewards of our communities” and “consider both the immediate crisis as well as the implications for 2012 and beyond.”

The letter encourages legislators to not just stop cutting but to craft a tax and revenue solution that will reverse the damage already done through cuts to vital state services from education to the social safety net; from mental health to nursing homes; from public safety to public highways.

You can read the full text of the open letter at http://www.kasb.org/kfqc/statement042010.pdf.

Budget Committee reporting for duty

In anticipation of the return of the full legislature on April 28, the Senate Ways and Means Committee returned to Topeka today to begin the business of putting together a budget for 2011 (and the last few months of 2010) to fund state services.

It is widely believed, based on comments by Senate leadership, that the Senate will prepare a budget that does not institute more crippling cuts to state services. What is left to be seen is whether or not their budget will try to begin the restoration of cuts already made and how they will go about closing the budget hole.

Today’s deliberations were more like a review of what they had discussed in prior meetings although they did handle a number of smaller ticket items – either adding a bit of money here or deciding not to there.

The committee had been scheduled to meet today and tomorrow but it was announced that they would also meet on Wednesday – perhaps to put a tax proposal in support of their budget together.

The House Appropriations Committee which so far has only talked about more cuts is scheduled to return on Thursday.

New study says cuts to services will cause more economic harm than a sales tax increase

At a press conference today hosted by the Kansas Economic Progress Council, a “not for profit designed to draw together organizations and businesses interested in advancing sound public policy in Kansas to enhance our state’s quality of life,” a study was released countering the findings of Art Hall, the Koch funded chairman of the Center for Applied Economics.

The new study by Dr. John Wang, interim director of the Center for Urban Studies and Kansas Public Finance Center at Wichita State University and a member of the Kansas Consensus Revenue Estimating Group, finds that the economic impact of cutting state services by $350 million would result in more job losses than if the state were to raise the sales tax by one percent to offset the cuts.

While admitting that the sales tax increase would cost 3,231 jobs, spending cuts would cost 5,177 jobs. Raising the sales tax to maintain state spending would result in 1,946 fewer jobs lost. This is due in large part to the fact that the impact of sales tax increase is spread out across the state and that state spending results in a multiplier effect on the economy. The multiplier effect is when money spent in the local economy is spent repeatedly. For example, when a teacher spends her money in local shops, the employees of those shops earn income and spend that money again in the local economy.

Here is what the study concludes in finding that an increase in sales tax is better for the economy than cuts in services:

“First, a high percentage of government expenditures initially stay within the state’s economy, going either to employees (state residents) in the form of salaries or to local businesses for the purchase of goods and services.”

“Second, the revenue enhancement scenario spreads the negative effects throughout the state, both geographically and across all 2.8 million residents.  The effect on any individual and on any business is minor.  In contrast, the spending reduction scenario severely affects a small number of state residents and businesses—state employees and those private-sector businesses that serve state employees and state government directly.  The likelihood of a business failing under this scenario is much greater than in the tax increase scenario.”

“Third, a portion of the sales tax increase will be exported to tourists and other visitors to the state.  The full effect of the tax increase is not felt within Kansas.”

Continuing Contract notice date change adopted

Late last night the final vote was taken adopting a change to the notice date under the continuing contract law. This bill has been in play for nearly the entire session. Here’s the blow-by-blow on Senate Bill 362 since the beginning.

The bill was introduced in the Senate Education Committee by Sen. John Vratil on January 13. As introduced, the bill tied the notice date to the day the Governor signed a budget bill. In a Senate Education Committee hearing, the bill was supported by United School Administrators, USD 259, and KASB and opposed by KNEA. Testimony focused on the desire of administrators not to non-renew staff without knowing the budget situation while KNEA held that it was more cruel to string teachers along and delay their entry into the job market. Problems with the idea of tying the date to the signing of a bill were also raised since the final budget bill is often late and – in extraordinary circumstances – has been signed as late as July.

Before passing the bill out of committee, the Senators amended it to allow school boards to choose to stay with May 1 or, by resolution, change the date to June 1. This is how the bill went to the full Senate on Feb. 16 where it was passed on a vote of 30 to 10.

The bill was then referred to the House Education Budget Committee where it had a hearing on March 2. KNEA again testified against the bill, this time also objecting to having two different dates with one of those dates outside of the work year for teachers.

When working the bill, Rep. Clay Aurand (R-Courtland) amended it by setting the date at May 15 for all school districts based on the general understanding that the budget has been pretty well hashed-out by the end of the first week of May. A sunset was also added to the bill. Aurand then amended into the bill the contents of House Bill 2699 which would allow for the extension of the teacher probationary period from three years to five. KNEA had opposed this bill in an earlier hearing.

KNEA had agreed to the May 15 date as a fair compromise on the notice issue since it met two important considerations – it was one date for all school districts and was within the teacher’s work year. With the addition of the probationary period change, we strongly opposed the bill as it went to the floor of the House.

The full House approved a motion by Rep. Gene Rardin (D-Overland Park) to strip out the change in the probationary period on a vote of 68 to 52. They then approved the change in the notice date on a vote of 109 to 13. KNEA was comfortable with this action and asked Senators to concur in the House amendments. Unfortunately, the Senate did not concur and sent the bill to a conference committee.

At this point USD 259 decided to work with the conferees in an attempt to set a June 1 notice date for administrators. This issue was not raised in the earlier committee hearings and took many observers by surprise. The members of the conference committee decided they did not want two different dates and so, for USD 259’s benefit, moved the notice date for everyone back to May 25.

Again, KNEA objected since this took the date out of the school year for about half of the teachers in the state. With the help of United School Administrators who had agreed with KNEA on the May 15 compromise and, eventually with the agreement of USD 259, the members of the conference committee agreed to pull the report back and amend it once again.

In a meeting "at the rail" yesterday, Senator Vratil suggested setting the date as the third Friday in May for notice to teachers and administrators and 14 calendar days later for teachers and administrators to notify the school district of their intent to return or leave. The sunset was also removed.

This means that the date will be as late as May 21 (as it will be this year) or as early as May 15. This year teachers will have until June 4 to notify school districts.

KNEA agreed to this change as it brought the date back into the school year for most teachers.

The conference committee report was then adopted by the House on a vote of 114 to 5 and then by the Senate on a vote of 40 to 0.

Catastrophic Aid: the other all-consuming issue!

Senate Bill 359, the change to catastrophic special education aid, was approved late last night. The bill represents a compromise between both interests in the special education debate.

Like SB 362, this has been a continual back-and-forth throughout the session. The issue was raised by a couple of events. First there was a post-audit report on catastrophic aid and then there was the issue of "pro-ration."

The issue came to a head when it was discovered that claims for special education catastrophic aid in the Shawnee Mission School District had jumped from zero to 333 in one year. Since catastrophic aid is taken off the top of the appropriation for special education, the more catastrophic aid claims there are, the fewer dollars are then available to be distributed on a per teacher basis for special education.

Amidst allegations of "scamming" and "gaming the system," legislators from districts losing money on the per teacher basis tried to cut off the flow of extra catastrophic aid to those districts that were pro-rating (Shawnee Mission, Blue Valley, and Olathe). Part of the argument came down to what people believed to be the intent behind the catastrophic aid. It was argued that catastrophic aid was created to help districts meet the costs of individual students whose special needs were so expensive as to be "catastrophic" to the district. In other words, you would get catastrophic aid based on an individual student, services for whom exceed $25,000.

There were many things brought into this debate during the session. For example, the fact that claims are made at the end of school year makes this aid reimbursement for money spent, the fact that special education reimbursement varies widely (from about 40% to over 200%), and the fact that it is possible to "double dip" services under the current formula.

This became almost a war between the Johnson County districts who were pro-rating and the rest of the state.

In the end, the House crafted a compromise bill that will soften the blow to Johnson County and make several changes to catastrophic aid into the future. In the conference committee report adopted last night on a vote of 103 to 16 in the House and 29 to 11 in the Senate, the following changes were made:

For the current school year, the threshold is set at $36,000. Next year it will go to a level set at two times the aid per special education teacher for the prior school year.

The bill prohibits the so-called "double dipping" – collecting from the state twice for any given student. For example, if the child generates transportation aid under the regular transportation formula, that same child would not get transportation aid under special education.

A temporary provision will ensure that for school years 2011-12 and 2012-13 no district will receive less than 75% or more than 150% of the state average per pupil amount. This provision sunsets after the 2012-13 school year. It will likely be reviewed then.

State Medicaid aid for special education will continue with no sunset.

So far…no tax increase, no budget, no cuts

While it may seem from these reports that we have been consumed with notice dates, probationary periods, and special education, we have also been actively working on tax and budget issues. We just haven’t had all that much to report!

The session started out with the Governor’s proposals on increases in the sales tax and tobacco taxes. The House quickly killed the sales tax proposal and has consistently rejected any tax increase ideas since January. The Governor’s proposals in the Senate did not even come out of committee despite cautious support of at least a version of the sales tax proposal by Committee Chairman Les Donovan (R-Wichita).

Another tax policy to get a lot of play was the bill from the Kansas Advisory Council on Intergovermental Relations (KACIR) to deal with the dramatic growth in tax exemptions. This bill in both its House and Senate versions would have eliminated many of the exemptions which have been granted in seemingly random fashion over the years.

The House version – HB 2549 – made it to the floor of the full House where it was decided to postpone action until May 3. This keeps the measure alive until the House has an idea of how big the budget hole will be (revenue estimates come in on April 16) at which time they will know if they really need to pass it in whole or in part. The Senate version – SB 476 – is sitting in the Senate Ways and Means Committee where it can be used later as a vehicle for tax changes.

Languishing in committee are bills to increase tobacco taxes and liquor taxes, and to establish a special tax on sugary beverages.

While there is usually a preliminary budget passed in the regular session – one that will be altered during the veto session after the revenue estimates come in – this year there hasn’t been a budget bill advanced to the floor of either chamber. It is almost as if they are resigned to getting more bad news in the coming weeks. "Why pass a budget now," they seem to be saying. "We’re just going to have to redo it in May."

Of course there is some truth to that. So when it comes to the budget we anticipate that budget committees will reconvene after the revenue estimates and before the return of the full legislature. By then, they will know the size of the budget hole and can begin the hard job of determining how to address it.

What is unknown is whether they will try to address it with cuts, with tax increases, or with some combination of the two.

So far, though, no new cuts have been enacted! That’s the good news. Of course, we are not out of the woods yet. There are plenty of members of the House and Senate who would love to cut more out of state services including education. We’re looking for a majority who will find ways to support our children, our public safety programs, our highways, our neighbors with disabilities and the other vital services that make our state a great place to live, work and raise a family.

What are YOU going to do about it?

The legislature is out until April 28. That is a remarkably long spring break and it provides you with opportunities to stand up for our state.

Here are some suggestions for those who want to see state services preserved, not gutted:

• Attend a legislative forum, community forum, or legislative "eggs and issues" back home. Ask your legislator what he/she will do to protect vital state services including education.

• Talk to your neighbors and friends. Tell them how challenging the situation is in our classrooms today and why more budget cuts cannot be absorbed without harming the education of our children.

• Get more of your teaching colleagues to subscribe to Under the Dome and start getting news from the capitol that impacts their work lives.

• Write a letter to the editor in support of increased taxes to preserve vital state services.

• Get connected with your KNEA UniServ office. Let your UniServ Director know that you are ready to do what it takes – during the veto session and in the upcoming elections – to make sure things get better.

• Write or call your legislator to tell him/her about your concerns.

There’s plenty you can do! Don’t take it for granted that the legislature wouldn’t dare cut funding for schools. Don’t assume your legislator will work hard to get people with disabilities off of waiting lists. If you don’t tell them to preserve public safety, they might not. If you don’t tell them you value public education, they might not.

Get involved!

Under the Dome will be on hiatus until committees return and begin meeting again.

New compromise on notice date worked out

Last night we reported that in conference, the legislators working on SB 362 decided to switch the notice date to May 25. The House had set it at May 15, a date accepted as a responsible compromise by KNEA and United School Administrators. Wichita Schools USD 259 asked the conference committee to change it to later so they would have more flexibility in non-renewing administrators.

KNEA objected to the May 25 date since about half of all school districts are out by then. With the help of United School Administrators and eventually USD 259, the conference committee agreed to reconsider.

In a meeting "at the rail" this morning, a new compromise was hammered out. Under the compromise the notice to teachers and administrators would be set at the third Friday in May (May 21 this year). Teachers and administrators would have 14 calendar days to respond to the district – essentially two Fridays later.

This is how the conference committee report will not be sent to the floor of the House and then the Senate for adoption. We anticipate that the report will be adopted today.

Catastrophic Aid conference committee report done

Senate Bill 359, the change to catastrophic special education aid, has been agreed to in conference with the following provisions:

For the current school year, the threshold is set at $36,000. Next year it will go to a level set at two times the aid per special education teacher for the prior school year.

The bill prohibits the so-called "double dipping" – collecting from the state twice for any given student. For example, if the child generates transportation aid under the regular transportation formula, that same child would not get transportation aid under special education.

A temporary provision will ensure that for school years 2011-12 and 2012-13 no district will receive less than 75% or more than 150% of the state average per pupil amount. This provision sunsets after the 2012-13 school year. It will likely be reviewed then.

State Medicaid aid for special education will continue with no sunset.

The bill represents a compromise between both interests in the special education debate. As with SB 362, we anticipate that the report will be adopted today.

A new education mega-bill in the works

While HB 2739 – the Frankenstein monster of an education finance bill – appears to be stalled for the time being, the education conference committee has become consumed with another potential education mega-bill.

This time, Rep. Aurand has proposed sewing together a number of house bills and creating a new monster bill. Under this proposal they would start with HB 2704 which allows several districts to consolidate into a smaller number of districts. Into the bill they would put the contents of:

HB 2410, removing from at-risk funding any children found in an audit to not be eligible for free lunch,
HB 2595, a modification to the 10-mile between district bus rules,
HB 2280, setting the bond and interest state aid at 15%, reduced from 25%,
HB 2239, the uniform accounting for school districts bill, and
HB 2601, Aurand’s at-risk linear transition bill.

Negotiations on this proposal have stalled and it is possible that they won’t continue until after the legislature returns in late April.

Both chambers are on the floor at this time. It is possible that they will adjourn sometime tonight, not to return until April 28

Legislators mess with delicate compromise on notice date

Senate Bill 362 has been quite a big deal as it has wound its way through the process. It started out as a bill setting the notice date under the continuing contract law to some nebulous date related to the signing of a budget bill. The Senate amended the bill to allow each individual school district to unilaterally choose either May 1 or June 1.

KNEA opposed the bill on the grounds that two dates were confusing and that notice should not occur after teachers were out for the year. The House committee amended the bill to set the date at May 15 (the budget is generally pretty well hammered out in the first week of May). Unfortunately they also added in a provision extending the probationary period to five years from the current three.

On the floor of the House, Representatives voted to remove the change in the probationary period and passed the bill out with just the change in notice date. The change to May 15 represents a compromise that was supported by both KNEA and United School Administrators.

Since the House version was different from the Senate version, it went to conference committee. That’s when the Wichita School District USD 259 came forward asking for a different date for administrators. They decided they needed June 1 as the notice date for administrators. In conference, the legislators decided different dates for teachers and administrators was problematic so they just switched the notice date to May 25.

KNEA objects to the May 25 date since about half of all school districts are out by then and we has been working with United School Administrators to get the conference committee to reconsider. Unfortunately, so far the Republicans on the conference committee have been unwilling to bend.

It looks at this time like the report will go to the floor for adoption with the May 25 date.

Will the legislature break tomorrow?

It looks right now like the legislature may adjourn tomorrow without adopting a budget or tax package for 2010. The decision is based partly on conflicts within the various "camps" in each chamber (Traditional Republicans vs Conservative Republicans vs Democrats) and partly on the fact that some just want the real data before making a commitment.

That data is due out April 16 when the consensus revenue estimating group meets to give the revenue outlook for the remainder of the year. This data should tell legislators just how big the budget hole is.

Ending early has the added "benefit" of preserving days to be used in the so-called "veto session." This time is traditionally set at three days (although it often goes longer) to deal with vetoes from the Governor. This year, if they leave tomorrow, they will have 13 days in reserve to spend on the veto session.

Look for their return on April 28.

House approves bills on final action

Senate Bills 362 and 359 were approved on final action this morning. Since they are both Senate bills, this means they will be sent back to the Senate. Senators then have a couple options. They can concur in the House changes to the bill which sends it on to the Governor for his signature (or veto). Or they can non-concur in the House changes and form a conference committee to hammer out an agreement with the House. 

Both bills are in pretty good shape now and we would hope the Senate agrees and concurs in the changes made by the House.

Senate Bill 362 changes the notice date in the continuing contract law, pushing it back 15 days from the current May 1 to May 15. The teacher date for resignations would also move by 15 days. Since the budget bill is usually passed in the first week of May, this would allow districts to have a pretty good idea of finances before determining if teachers or administrators needed to be released.

The bill was originally drafted to have a floating date based on the when the Governor signed some budget bill but was amended in the Senate to allow school districts to choose between May 1 and June 1. KNEA felt that it was best to have one standard date and that it be within the school year to ensure that teachers get their notice. The House did just that. United School Administrators and KNEA agree that this is a good compromise position.

The bill passed with strong bipartisan support with 107 votes.

Senate Bill 359 has been controversial since its introduction. This bill deals with catastrophic state special education aid. The bill has been characterized as pitting Johnson County School Districts against the rest of the state and the struggle has been to find a way to return money to districts out of Johnson County without stripping Johnson County of millions of dollars.

The way catastrophic aid works is that for those children whose special education costs would be “catastrophic” to the district budget, the district could apply for special state aid. This aid would pay 75% of the costs over the first $25,000 for that child. It was later found that the law allowed districts to prorate their special education costs over a number of students and then claim catastrophic aid.

The state pays catastrophic aid out of the appropriation for special education and then divides up the remainder on a per teacher basis. The more catastrophic aid paid out the less money there is left to go out per teacher. So when Shawnee Mission began prorating, their catastrophic aid claims went from zero to 333 in one year. There were also increases in the number of individual students across the state that cost more than $25,000. When these two things happened simultaneously, the per teacher reimbursement dropped significantly.

Senate Bill 359 would have dramatically raised the threshold for catastrophic aid, thereby reducing claims and putting money back in the per teacher reimbursement.

Eventually the bill was amended in the House Education Committee to give a measure of protection to Johnson County while also increasing special education funding for other districts. In addition, on the House floor, an extension of the Medicaid reimbursement for special education was put in, making the bill better for districts with large numbers of Medicaid eligible students.

KNEA believes the bill as passed by the House is a good compromise. Some will be unhappy with it but no one will be devastated.

The amended bill had wide support on the House floor, passing with 109 votes.

House votes to support teachers!

Change in probationary period defeated on the floor

Senate Bill 362 came up for debate today and, with the worst of it stripped out, was advanced to final action. That vote will take place tomorrow morning.

When it came to the floor there were two parts to this bill.

Part one dealt with the notice date under the continuing contract law. As it is in this bill now, the notice date would be changed to May 15 for school districts and 15 days later for teachers and administrators. The change would sunset in three years. In its current form, the proposal on continuing contract notice is acceptable because it is one date for all schools within the school year and it sunsets.

Part two was an amended version of House Bill 2699. This provision would have allowed a school administrator to ask a third year teacher to waive his/her right to due process for two more years or face non-renewal. 

This provision, if adopted, would have allowed school districts to:

• Non-renew more teachers without giving them a reason and without having to defend the decision. In this scenario, evaluators have no accountability for their evaluations and employment decisions.
• Allow weak teachers who have failed to demonstrate their skills within three years to spend two additional years in our classrooms. In this scenario, more children will experience a teacher who is marginal at best.
• Absolve administrators of the need to provide real new teacher support or conduct quality evaluations. With five years to get the decision made, some schools will feel less committed to provide mentoring and induction programs for new teachers or to water down those programs.

There was a motion by Rep. Geraldine Flaharty (D-Wichita) to send the bill back to the Education Committee. Her argument was that the bill dealt with education policy, not the budget and it was therefore wrong to have sent the bill to the Education Budget Committee in the first place. Flaharty’s motion failed on a voice vote.

Next came an amendment by Rep. Gene Rardin (D-Overland Park) to strip out the second part dealing with the probationary period. Several legislators came to the well to argue one side or the other. But in the end, 68 representatives voted to keep the probationary period as it is and ensure that a marginal teacher would not have a fourth year with students.

All Democrats except Pat Maloney (Greensburg) voted for the Rardin amendment; they were joined by the following 20 Republicans:

This would be a great time to send a thank you note to these 68 legislators. You can email any of them using the standard legislative email format: firstname.lastname@house.ks.gov.

The message is simple: Thank you for voting to remove the five year probationary period for teachers from SB 362. This vote treats teachers with respect and ensures that students will not have marginal teachers in their classrooms. It protects the integrity of our school system. Thank you again for your vote.

Catastrophic Aid bill advances with little debate

Senate Bill 359, the bill addressing catastrophic special education aid, was amended and advanced to final action this afternoon.

The bill had been amended in the House committee to take the increase in the threshold back to $25,000 for one year and to deal with the reimbursement disparities. The bill also stops the so-called “double dipping” – collecting funds for one service twice. The committee amendments were offered as protecting part of Johnson County funding for one year rather than taking it all away now.

On the floor the bill was amended by adding in the contents of Senate Bill 512 which extends the Medicaid reimbursements into the future. This was set to go away.

We know that many legislators have very strong feelings about aspects of this bill and who is accounting for special ed in what manner. What may have seemed less controversial this afternoon could become an interesting final action vote tomorrow!

When is a cut an increase?

House School Funding Bill Released

House Bill 2739 – crafted by the Republican members of the House Education Budget Committee – is now available; and it’s a doozy.

The bill, created like a Frankenstein monster from the remains of other bills sitting around in various corners of the capitol, puts into the school finance formula the $172 million cut to K-12 education now being promoted by House leadership.

This bill was made to look like an increase by setting base state aid per pupil at $4450, a full $17 higher that what schools were supposed to get this year. But the bottom line is, no matter what they are calling BSAPP, schools are still getting cut by $172 million.

It works this way:

• First, it cuts $85.9 million from general state aid (a reduction of $131 per pupil if it were taken off of BSAPP).
• Next it cuts another $85.9 million off of supplemental general state aid (LOB state aid) reducing aid to property poor districts even more.
• It eliminates high enrollment weighting and cuts all other weightings (at-risk, bilingual, etc.).
• It takes 10% of a district’s LOB levy and renames it "foundation aid" so it can be used to fund the increase in the BSAPP. That’s right, they cut BSAPP to $4005, then take local LOB funds, rename them "foundation aid," and claim that the base is now $4450!
• They cap LOBs at 17% or 18% with an election but grandfather in all districts with higher existing LOBs.
• Two new unequalized local mill levies are now permitted. The first one lets a school district raise another 5% locally for an "activities fund" which cannot be used for instructional purposes. The other lets a school districts receiving less than the state average in combined general and supplemental general state aid to levy a property tax to 7% - called the "equity budget – in order to meet the state average. All school districts are apparently permitted to raise local mill levies to make up for the state LOB aid cuts.

House leadership continues to say that tax increases are wrong in this economic climate – at least that is the excuse for not raising state taxes – but in this bill they suggest school boards pass an $85.9 million property tax increase just to stay even on part of the cut in state aid. And they promote the "activities fund" and the "equity budget" as good ideas even though they require local school boards to raise property taxes even more.

How is it that a state tax increase is bad while local property tax increases are good?

HB 2739 is bad news. It pretends to increase BSAPP while cutting $172 million out of state aid for schools. It pretends to "hold the line on taxes" while forcing local school boards to enact large local property tax increases.

See the funding impact on your district by reviewing this spreadsheet from the Department of Education. Click here.

How many mills of property tax will it take for your district to replace the LOB aid cut? Click here.

We urge you to contact your Representative and ask him/her to vote NO on House Bill 2739. What follows are excellent talking points for a message to your legislators. You can email your Representative using the standard email address (firstname.lastname@house.ks.gov– for example: tom.sloan@house.ks.gov) or by going to the "Contact My Legislator" link on the KNEA website (http://capwiz.com/nea/ks/state/main/?state=KS&view=myofficials#0).

Talking points on HB 2739:

• It cuts all districts by $85.9 million, equal to approximately $131 base budget per pupil, or 3.2 percent.  This will lead to further reductions in staff and services to students at a time when educational standards and expectations continue to increase.
• It cuts a further $85.9 million from local option budget state aid, which will impact some districts far more severely than others, based solely on the property wealth of the districts.  Districts will either have to cut their budgets MORE than the $131, or raise local property taxes.
• Although House leaders say taxes should not be increased, this bill would result in an $85.9 million property tax increase if districts seek to replace lost state LOB aid, with local increases varying from under one mill to nearly 50 districts with double-digit mill levy increases.
• Although school districts have been criticized for not directing more dollars to the classroom, the bill creates a new fund to allow districts to spend more on local activities and sports, while cutting the general fund that supports instruction.
• The bill authorizes two new property tax-based funds, the Local Activities Budget and the Equity Budget, neither of which receives state equalization aid.  The result will likely be both higher property taxes in certain districts and further disparity in mill levies for districts seeking to use them.
• The bill eliminates high enrollment weighting and reduces other school finance weightings.
• HB 2739 will require all districts have at least a 10 percent local option budget as a "local foundation budget," in addition to the 20-mill statewide levy and general state aid.  The result will be different mill levies to fund the "foundation" requirement of the state.

Again, we urge you to contact your Representative and ask him/her to vote NO on House Bill 2739. What follows are excellent talking points for a message to your legislators. You can email your Representative using the standard email address (firstname.lastname@house.ks.gov– for example: tom.sloan@house.ks.gov) or by going to the "Contact My Legislator" link on the KNEA website (http://capwiz.com/nea/ks/state/main/?state=KS&view=myofficials#0).

House may take up due process bill tomorrow

Let your legislator know the bill is a bad idea

Senate Bill 362 sits on the House calendar below the debate line for today but ready for possible action tomorrow or Wednesday.

There are two parts to this bill.

Part one deals with the notice date under the continuing contract law. As it is in this bill now, the notice date would be changed to May 15 for school districts and 15 days later for teachers and administrators. The change would sunset in three years. In its current form, the proposal on continuing contract notice is acceptable because it is one date for all schools within the school year and it sunsets.

Part two is an amended version of House Bill 2699. This provision would allow a school administrator to ask a third year teacher to waive his/her right to due process for two more years or face non-renewal. Proponents will tell you this is to help weak teachers. It is not. It is intended to extend the probationary period to allow more teachers to be let go with no reason – five years worth of new hires, not just three.

They will tell you this is voluntary on the teacher’s part. But in the real world when your employer gives you a choice between no job and waiving your rights, is that really voluntary. Of course not.

This bill, if adopted, will allow school districts to:

• Non-renew more teachers without giving them a reason and without having to defend the decision. In this scenario, evaluators have no accountability for their evaluations and employment decisions.
• Allow weak teachers who have failed to demonstrate their skills within three years to spend two additional years in our classrooms. In this scenario, more children will experience a teacher who is marginal at best.
• Absolve administrators of the need to provide real new teacher support or conduct quality evaluations. With five years to get the decision made, some schools will feel less committed to provide mentoring and induction programs for new teachers or to water down those programs.

House Bill 2699 now contained in SB 362 is bad for schools, bad for children, and bad for teachers.

Urge your Representative to vote NO on Senate Bill 362.

Click here to send a message to your Representative.

House Ed Committee deals with catastrophic special education aid

The House Education Committee met for what is expected to be the last time for the year and dealt with SB 359, the bill changing catastrophic special education aid – an issue that has generated plenty of controversy this year.

The issue came to a head when claims from the Shawnee Mission school district went from 0 to 333 in one year. SMSD changed the way in which they calculated eligibility for catastrophic aid. They used a model similar to one used in both the Blue Valley and Olathe districts. Although none of these districts did anything that was not allowed under the law, because catastrophic aid comes off the top of the full appropriation for special education, the result was to send a lot more special ed aid to Johnson County at the expense of the per-teacher reimbursement.

Over in the Senate Johnson County legislators tried and failed to amend the bill to protect Johnson County funding for the year and delay the enactment of this change. Today, in House Education, Rep. Sheryl Spalding (R-Overland Park) successfully amended the bill to reduce the harm to Johnson County districts.

A subsequent amendment put a floor and ceiling on the special education reimbursement percentage. Under this amendment, no district would receive less than 75% reimbursement and none would receive more than a 150% reimbursement. Currently the reimbursement percentage runs for about 40% to over 200%.

Since the Senate refused to amend the bill at all, there is likely to be a rowdy conference committee on this issue if the bill passes the full House as amended by the committee.

House Appropriations Committee balances budget on education, state employees, KPERS

The House Appropriations Committee adopted the report of the House Education Budget Committee which reduces K-12 education state funding by $85.9 million and LOB state aid by $85 million. The LOB aid will force local school districts who receive such aid to either dramatically cut budget or raise mill levies to make up the loss of state aid. Districts that do not receive LOB state aid will see a much smaller cut to their schools.

Republicans on the Appropriations Committee are pretending that this is not a cut to K-12 because it is simply not replacing the federal stimulus aid that goes away. "We’re not cutting, we’re just not replacing!" But in the real world, the Committee action reduces state aid to schools by over $170 million.

But it didn’t stop at K-12 education. In addition to gutting K-12 education, the Committee adopted a 5% pay cut for all state employees, and froze state employer contributions to KPERS despite evidence that they need to increase such contributions.

The Kevin Yoder/Mike O’Neal plan for the budget amounts to putting an invisible tax on children, state employees and KPERS members.

Senate Tax Committee ignores need; caves to AFP and Koch Industries

Despite reasonable proposals that had been floated by Committee Chairman Les Donovan (R-Wichita), the rest of the Senate Assessment and Taxation Committee refused to give consideration to any tax increase to balance the state budget.

Many had expected the committee to at least accept Donovan’s proposal to increase the sales tax to 6% and repeal the sales tax on groceries after three years but even that idea could not pass the committee. Committee members rejected any increase in the sales tax, the cigarette tax, alcohol taxes or taxes on sugary beverages.

Koch Industries of Wichita, through their front organization Americans for Prosperity, had launched a website – stop the war on smokers – in their effort to gut the state budget. AFP works hard to inspire hatred for government using whatever means possible.

It is sad that so many legislators feel the need to obey Americans for Prosperity and ignore the needs of Kansas children, Kansans with disabilities, public safety, and even highway repairs. This is why…

Kansas Economic Progress Council Blasts Kansas Policy Institute, AFP, Kansas Chamber of Commerce

The Kansas Economic Progress Council went after the extreme anti-government organizations that promote the destruction of state government services. The Kansas Policy Institute, Americans for Prosperity, and the Kansas Chamber of Commerce have taken a hard line opposing all tax increases for any purposes including highway maintenance and repairs.

The Kansas Economic Progress Council includes local chambers of commerce and economic developers in Kansas which advocate for investments in transportation, economic development and education to grow the economy. In testimony before the Senate Transportation Committee, the Council said, "Local chambers and economic developers eat, sleep and breathe economic development.  They stay awake at night worrying about what they can do to grow jobs and the economy in their communities."

KPI, AFP, and KCC are more concerned with protecting and expanding corporate tax cuts.

House Ed Committee Republicans send bill gutting teacher rights to the full House

Bill would allow school administrators to pressure teachers into waiving due process rights

The House Education Budget Committee acted today to let school administrators extend the probationary period for a teacher from three to five years. Superintendents who testified in favor of the bill tried to portray this diminution of teacher rights as a favor for teachers but it would simply allow schools to expand the pool of teachers they can let go for no reason.

While the bill as originally requested by United School Administrators would have made every teacher subject to a five year probationary period during which they could be let go with no reason, it was amended in committee on a motion of Rep. Clay Aurand (R-Courtland) so that the three year period would be retained but administrators would be given permission to tell a third year teacher he/she needed more time to prove their worth or face immediate non-renewal if he/she did not agree to extend the probationary period.

While in a perfect world, the Aurand amendment would be a good idea, in reality districts would feel free to simply declare that all third year teachers "need more time" and insist that they all waive their rights or lose their jobs.

As Rep. Gene Rardin (D-Overland Park) rightly pointed out, there is no set of standards under which a teacher could be considered for the "offer" of two more years of at-will status. Any teacher, regardless of his/her performance could be subject to this administrative desire to expand the pool of easily released teachers.

Aurand amended this attack on teacher rights into Senate Bill 362 which, as amended would change the notice date under the continuing contract law from May 1 to May 15 and sunset the change after three years. Aurand offered the amendment to set the firm date as opposed to the two dates allowed under the original bill. The sunset was added with an amendment by Rep. Harold Lane (D-Topeka). The Aurand and Lane amendments would have removed KNEA objections to the bill but we will now oppose SB 362 due to the addition of the attack on due process rights.

The bill was moved out of committee with the support of Republicans Joe McLeland (Wichita), Clay Aurand (Courtland), Arlen Siegfreid (Olathe), Brenda Landwehr (Wichita) and Richard Carlson (St. Mary’s). It was opposed by Democrats Harold Lane (Topeka), Bill Feuerborn (Garnett), and Gene Rardin (Overland Park).

"Those who love law and sausage should never see either one made…"

But this looked more like making head cheese!

The House Education Budget Committee also advanced a Republicans-only budget recommendation for education that will cut schools by $203 million next year.

The actions were all taken on motions by Representative Clay Aurand (R-Courtland) whose first motion rolled six bills into one new substitute bill. The substitute bill includes:

• HB 2739 – Aurand’s school finance bill that sets a new base state aid per pupil and requires LOB levies to pay for 10% of it, making part of the LOB state aid. Aurand also reduced the BSAPP level in HB 2739 from $4492 to $4450,

• HB 2607 – Aurand’s at-risk weight linear transition bill except that he reduces the BSAPP level in this on also to $4450,

• HB 2647 – a bill letting school districts levy another unequalized property tax to fund school activities.

• And amendment on HB 2280 by Rep. Bill Otto (R-LeRoy) that would give districts more flexibility in transferring money from the general fund to the capital outlay fund and to the contingency reserve fund,

• HB 2719 – a bill allowing school districts with a per pupil funding amount that is below the state average to levy a local property tax to raise their per pupil amount to the state average, and

• And unspecified proposal to allow districts to collapse a number of funds together in the name of "flexibility."

Once this megabill had been dispatched on party-line votes, Aurand turned to cutting education funding.

His first motion would cut $85.9 million from schools by simply not replacing federal ARRA funds that had been used to shore up this year’s budget. Aurand’s second motion would cut another $85 million by not replacing federal ARRA funds that had been used to provide LOB state aid. His third motion eliminated the Governor’s proposed $50 increase in BSAPP saving another $32.7 million.

Each motion passed with five Republican votes in favor and three Democrats voting against.

These cuts will now serve as the committee’s recommendation to the full Appropriations Committee tomorrow morning.

The most interesting statement of the day came from Rep. Richard Carlson (R-St Mary’s) who told the committee, "In six and a half hours of debate on the House floor yesterday, not one motion was made to increase taxes so this is where we are." Carlson himself did offer a tax amendment during that six and a half hours of debate. Carlson’s motion was to eliminate the corporate income tax – a motion which, had it passed, have cost the state in the neighborhood of $250 million!

House takes up tax measures on the floor

Votes show unity between Democrats, Republican moderates

The House came to the floor to day to debate a series of tax bills including HB 2549, the bill repealing many sales tax exemptions. It is widely believed that House leadership wanted to push a vote on this bill. In this politically-motivated scenario, Democrats and Moderate Republicans might be forced to vote for a revenue package that would probably fail giving O’Neal and Yoder more ability to call for cuts to K-12 education to balance the budget. They could rationalize this by saying the chamber had weighed in on taxes and rejected the idea.

What transpired, however, was a little different. Instead of taking the bait, Democrats and Moderate Republicans united behind a move to delay any decision on the bill until May 3 by which time the Legislature would know the full revenue picture based on the April consensus revenue estimates. The motion by Nile Dillmore (D-Wichita) to delay the vote passed on a vote of 64 to 57.

On the very next bill, HB 2519, the same coalition held. This bill related to streamlined sales tax compliance – putting Kansas on track to collect sales tax on all internet sales. Representative Virgil Peck (R-Tyro) tried to kill the bill by offering an amendment to strike the enacting clause. His amendment went down to defeat. Peck – who had carried the bill on the floor – then declined to make the motion to advance the bill. Representative Julie Menghini (D-Pittsburg) made the motion which passed with 64 votes.

Similar votes were taken on motions to amend other bills by offering additional tax credits to certain businesses and eliminate some income tax liability from high income retirees.

From these actions, it appears that the coalition of Moderate Republicans and Democrats are gearing up for a fight over the state budget and dealing responsibly with the budget gap so as to protect our schools, our seniors, our neighbors with disabilities, public safety, and our highways.

House Education Budget Committee set to take up the 2011 education budget – among other items – this afternoon

As we write this, the House is slowing working through their debate agenda. A number of committees have already been cancelled. It is possible that, if they don’t get going, that committee meeting will also be canceled.

The Committee has a heavy agenda today including deliberations on the 2011 education budget, a hearing on HB 2718 which gives the Revisor of Statutes a role in school finance litigation, and a hearing on HB 2739, a brand new bill from Rep. Clay Aurand (R-Courtland) changing the school finance formula by requiring a portion of local mill levies to be used to fund base state aid.

The Appropriations Committee is scheduled to receive the recommendations of the Education Budget Committee at 9:00 am tomorrow. We will report on these actions tomorrow.

Large Crowd of Education Supporters Rally at the Capitol

An enormous crowd of students, teachers, parents, school board members, and administrators braved an unusually cold morning to rally outside the Capitol building today. The enthusiastic crowd, chanting, "We want what’s right, not what’s left!" heard from a number of education supporters including Governor Mark Parkinson, 2009 Kansas Teacher of the Year Cindy Couchman, and KNEA President Blake West.

Look for coverage of this event in your paper or on your local television news tonight.

Senate Ed takes up consolidation bill

The Senate Education committee held hearings on HB 2704 today. HB 2704, as amended, would allow the boards of education of any three or more districts to discuss issues relating to consolidation and enter into agreements to form two consolidated unified districts. There were four proponents and no opponents or neutrals. Among the proponents was Senator Mark Taddiken (R-Clifton) who has contained within his senate district the original three school districts that wanted to consolidate into two districts. Axtell, Sabetha and B & B wanted to become two school districts. The proponents all stated that the bill was important for future consolidation efforts.

Dale Dennis from KSDE stated that there are now five additional districts submitting proposals to consolidate. That is the largest number of districts submitting consolidation proposals to KSDE that Dale can remember. All of the proponents stated that student achievement was at the top of their list as a reason for the bill and each one echoed the need for consolidation to take place as a result of local decision making.

Senate Ways and Means considers tax exemption clean-up

The Senate Ways and Means Committee held a hearing on SB 476, the bill from the Kansas Advisory Council on Intergovernmental Relations (KACIR) that would repeal many sales tax exemptions. Secretary of Revenue Joan Wagon spoke in support of the bill as did Mark Tallman of KASB, Mark Desetti of KNEA, Shannon Jones of the Statewide Independent Living Council of Kansas, and the owner of a private fitness center.

Opposing the bill were representatives of some of the organizations now enjoying a sales tax exemption including religious groups, the YMCA, and organizations using charity bingo.

KNEA supports the establishment of a set of rules for tax exemption eligibility. We believe that the tax system will be more stable if rules govern the granting of exemptions.

House Select KPERS Committee takes up KPERS payments for furloughed employees

The House Select Committee passed out Senate Bill 146 after working on amendments to the bill in a subcommittee. This bill would impact the teachers we represent in the Kansas Schools for the Deaf and Blind. SB 146, as amended, would reinstate statutory provisions related to furloughs of certain state officers and employees which expired on June 30, 2007. The bill would provide that if certain state officers and employees are placed on furlough, contributions will continue to be paid by the state for both the employee and employer payments for retirement, death and long-term disability benefits. Under the current budget climate there has been plenty of talk about saving money by furloughing state employees. These employees would not be paid for the days of furlough but SB 146 would ensure the appropriate KPERS contributions were made without further harming the furloughed employees.

Senate Tax Committee may be getting close to a proposal

The Senate Assessment and Taxation Committee continued their hearing on SB 516 which increases the sales tax rate to 6.3% for three years. There were four opponents today; Kent Ekles from the Kansas Chamber of Commerce, Dan Murray from National Foundation of Independent Business; Don McNeely from the Kansas Automobile Dealers Association, and a representative of convenience stores.

Committee Chair Les Donovan (R-Wichita) suggested changes to a number of tax increase bills currently in the Committee. Donovan suggested raising the sales tax to 6%, keeping it at that rate into the future and after three years removing the sales tax on food. On the cigarette tax increase, he would lower the proposed tax increase from $.55 to $.25. He would also lower the proposed tax increases on sugared beverages and alcohol gallonage. According to the senator, if the committee adopted his proposals, they would bring in an increase of $340-350 million.

Donovan’s proposal on the sales tax increase is particularly appealing because it would provide for significant relief for the working poor after the third year with the removal of the sales tax on food.

The committee will hear the liquor tax bill and the sugared beverage tax bill during the next two days and then work the bills on Thursday.

Chappell calls for closing most Kansas school districts
Kansas Policy Institute backs him up

Walt Chappell, a controversial member of the State Board of Education and president of the mysterious Education Management Consultants (see if you can find them on the internet; we can't), appeared before the House Education Budget Committee to promote a massive consolidation of Kansas school districts that would result in no district having fewer than 10,000 students.
 
Chappell's bill, HB 2728, resurrects the ideas of former school superintendents Sharol Little, Kenneth Kennedy, and Gary Norris, and retired associate superintendent Morris L. Reeves, under which they proposed the establishment of about 40 "Regional Education Districts" or REDs. The bill would force the consolidation of the current 293 Kansas school districts into 40 REDs each managed by one seven member school board and one superintendent.
 
Supporting Chappell was Dave Trabert, Executive Director of the anti-government Kansas Policy Institute, formerly known as the Flint Hills Center for Public Policy. Trabert spends most of his time under the dome calling for ever deeper corporate tax cuts, opposing any and all tax increases, and railing about how schools are over-funded and under-performing.
 
An analysis of HB 2728 by the Kansas Association of School Boards demonstrates the absurdity of this approach. In order to form a 10,000 student school district in northwest Kansas, 18 counties would need to merge together as one district!
 
This new district - made up of 31 current school districts - would still be shy of the 10,000 student mark by 46 students and would cover 16,490.5 square miles! The new district would also lose $21,165,760 in low enrollment weighting.
 
Chappell and Trabert insist that this is good for student learning because the high school kids in the newly formed USD would have more opportunities available. We acknowledge that the "more opportunities" idea is possible but it is true only if those high school students are grouped so as to have a large enough population in one building to provide all of those opportunities efficiently. Lawrence USD 497 is a district of about 10,000 students and has two high schools. Those high schools do offer many learning opportunities for their students. But Lawrence is also a district of 175.2 square miles.
 
Chappell insists that under HB 2728 no schools would be closed. If that is the case, then how is it possible to offer all of those high school enrichment opportunities in the same small high schools? The truth is - if no schools are closed, no more student opportunities can be made available, especially given the loss of over $21 million in funding for the new RED. And if the new RED has only two high schools so as to provide more opportunities efficiently, which towns will die? How many hours will kids spend on buses? How many miles will our high school students have to drive to reach the new high school?
 
Perhaps the proponents haven't given these issues any consideration.

Kansas Policy Institute Flip-floppers!

They were against it before they were for it…

We were just a little surprised to see Dave Trabert, executive cirector of the Kansas Policy Institute, waxing poetically about the wonderful benefits of massive school consolidation yesterday. After all, when they were the Flint Hills Center for Public Policy, they published a report entitled, "School Consolidation: An Ineffective Way of Improving Education." And there was Dave just yesterday, talking about how this massive consolidation would be good for kids!
 
That must be why they needed to change their name; they were changing their positions.
 
See their original anti-consolidation report here:  

Who will come to the rescue?
Budget and Tax discussions now under way

The Senate Ways and Means Committee hammered out the first 2011 budget bill this morning, crafting a plan that keeps things fairly even with this year and eliminates much of the Governor's modest increases for next year. Many of the decisions are postponed to be discussed later in the omnibus discussions. This is setting up a list of priorities to be considered should there be money to make new adjustments.
 
The unfortunate thing is that the budget set up by the Committee has a pretty significant hole in it - a hole of almost $364 million. Senate leadership has already announced their support for a tax increase to fill that hole but for now those discussions are over in the Senate Tax Committee.
 
Senator Janis Lee (D-Kensington) asked that the Committee put both the spending bill and the needed tax increases together. She is (rightly) worried about giving legislators a chance to vote on a budget with no more cuts and then to vote against the tax increase to support it. Think about the campaign postcards of those legislators: "I voted yes for our schools and no on higher taxes!" Of course, you can't do both. You can't support schools, the social service safety net, senior citizens, public safety, and highways without the tax increase needed to provide the funding.
 
Unfortunately, putting the two (spending and taxes) in one bill would be a violation of the constitutional prohibition on two-subject bills. They will have to be rolled out separately and then it is up to all of us to hold legislators accountable for their votes.
 
Senate Tax has already held hearings on the proposed sales tax and tobacco tax increases and will hold hearings next week on proposals to increase alcohol taxes and taxes on sweetened beverages. Tax increases generally don't get a favorable audience in that committee so we have no real idea whether or not the Committee will get behind leadership on this issue.
 
On Monday, the Senate Ways and Means Committee will hold a hearing on the bill to reign in sales tax exemptions.
 
Over in the House, they have already worked many of the tax increase proposals. The full House killed the sales tax increase and the sales tax exemption bill sits on the debate calendar in a kind of legislative limbo. The Appropriations Committee is not yet ready to begin cobbling together their first proposal on the 2011 budget. They have yet to get reports from the education budget committee or the social services budget committee - two of the biggest items in the state budget. Word is that those are coming in early next week with deliberations to begin on the budget bill by Wednesday or Thursday.
 
It's going to be a big week for money talk next week!

KPERS bill heard in Senate Ways and Means Committee

A bill making changes to KPERS with the intent of shoring up the system had a hearing today in the Senate Ways and Means Committee.

Senate Bill 564 would maintain the defined benefit retirement system while ramping up contributions in an attempt to address the unfunded actuarial liability. Specifically, the bill would:

• Raise the cap on the annual increase in the employer contribution from 0.6 percent to 1.0 percent.
• For four years beginning in 2012, increase the employee contribution by 0.5 percent. For KPERS members in Tier One (almost everyone) this would raise the employee contribution from 4 percent to 4.5 percent in 2012, to 5 percent in 2013, to 5.5 percent in 2014, and to 6 percent in 2015 and future years. For Tier Two members (everyone hired after July 2009), this would raise the employee contribution from 6 percent to 6.5 percent in 2012, to 7 percent in 2013, to 7.5 percent in 2014, and to 8 percent in 2015 and future years. The additional 2 percent employee contribution in Tier Two pays for a 2 percent cost of living adjustment after retirement beginning at age 65. Tier One members have no automatic COLA provision after retirement.
• Increase the benefit multiplier from 1.75 percent to 1.85 percent for each year of service under the increased employee contribution.

This bill is a “good news/bad news” situation.

On the good news side, employer contributions go up and the defined benefit system is preserved.

On the bad news side, employee contributions go up although the increase is coupled with a benefit increase after retirement.

While in a perfect world we would prefer to see no employee contribution increase, we are particularly concerned about the impact of this increase on KPERS members in very low wage positions. The impact of a two percent contribution increase on education support personnel and other low-wage state employees may be very difficult to absorb, especially for those in Tier Two.

We appreciate the efforts of the Senators to preserve a good retirement system and hope that they can continue to shape this bill in ways that assist low-wage workers to meet any increase in the employee contribution.

Consolidation “stick” removed from bill on House floor

In floor debate yesterday, the “stick” that has been called “consolidation through starvation,” was removed from House Bill 2704 before advancing the bill to final action.

As it went to the floor, the bill did two things regarding consolidation. First, it would allow three or more districts to work together to create two districts, letting at least one of them dissolve and move part of its territory into each of the other districts. Secondly, for districts of less than 200 square miles and fewer than 200 students, it would have set low-enrollment weighting at the 200 student level. This second provision would have reduced low-enrollment weighting for districts that have been characterized as “small by choice.” It is intended to act as a stick rather than a carrot in encouraging consolidation.

On the floor the members stripped out the “stick” and left only the permission for three or more districts to consolidate into two.

The bill was adopted this morning on a final action vote of 121 to 1.

Daughter of KNEA lobbyist honored as one of the really, really great high school seniors in Kansas

Lawrence Free State High School senior Caitleen Desetti, daughter of KNEA lobbyist Mark Desetti, continues to rack up honors as she approaches graduation. Earlier this year, Caitleen was recognized by the KU Alumni Association with their High School Scholars Award given to the top 10 percent of high school seniors. She will be honored in May with the Governor’s Scholars Award for the top one percent of high school seniors. Today, she received the Lawrence Journal World Academic All-Star Award given to 10 high school seniors in the Journal World’s readership area, recognizing them for academic achievement, extra-curricular involvement, and service to school and community.

Caitleen’s father, Mark Desetti, suggested that, “The apple doesn’t fall far from the tree.” Most observers note that the tree is more likely to be Caitleen’s mother, Judy.

House Education Committee begins special ed aid discussions…

The House Education Committee has begun talking about the catastrophic aid issue that was so contentious in the Senate. While the House is examining the issue in the context of a house bill, they will likely deal with it when the Senate sends SB 359 over to them.

Senate Bill 359 raises the threshold for catastrophic aid and would dramatically reduce the claims being made by several school districts (notably Shawnee Mission, Blue Valley, and Olathe) that have pro-rated services in order to maximize their claims. It is important to note that these districts have not done anything that is not permitted but since catastrophic aid is taken off the top of all special education state aid, when more catastrophic aid claims are made, the per-teacher reimbursement decreases.

Johnson County Senators John Vratil and Tim Owens who both sit on the Senate Education Committee appear to realize that the increase in the threshold is inevitable and tried to get the Senate Committee to at least allow their districts to be grandfathered for this year. The committee did not adopt the grandfathering provision and sent the bill on for full Senate consideration.

This issue is far from settled. Look for the grandfathering amendment on the floor and a continued battle in the House.

…And passes consolidation bill

The House Education Committee also passed out House Bill 2704 dealing with consolidation. The bill would allow three or more districts to consolidate into two districts (essentially allowing one district to split itself among some others in consolidating) and keep the incentive funds for consolidation.

In addition, the bill changes low enrollment weighting such that the cap on low-enrollment weighting which is at 100 students in current law would change to 200 students for any district with less than 200 square miles and fewer than 200 students. This had started with a 400 student cap but was amended in committee. Districts that meet these size and enrollment limits would lose some low-enrollment money if the bill becomes law. The intent of the bill is to encourage consolidation among districts that are “small by choice.”

The issue is always controversial and should generate some lively debate on the House floor.

House Ed Budget hears bill declaring all new teachers expendable for five years!

The House Education Budget Committee held a hearing on HB 2699 which would change the probationary period from three to five years. This means that school districts could let teachers go at the end of the school year without having to justify the decision for five years instead of the current three. Obviously, it makes it easier to balance your budget if you can just let more teachers go without the worry of defending your decision.

The proponents, including Superintendents Brenda Dietrich of Auburn-Washburn and Jim Lentz of Augusta, admitted that there were very few teachers that are “on the cusp” of being a good teacher after three years. Most, they told the committee, had demonstrated that they met standards within the three year probationary period; some demonstrate it almost immediately. Yet the bill puts all teachers under the “no rights for five years” category regardless of their performance and there is no companion bill requested by United School Administrators to allow them to grant due process rights to those teachers who demonstrate their excellence in just one or two years.

Terry Collins, Director of the Doniphan County Education Cooperative, Cheryl Semmel of United School Administrators, and Mark Tallman of KASB all testified in favor. Blue Valley USD 229 was represented by their lobbyist Bob Vancrum who submitted written testimony in support. The bill was requested by USA.

KNEA President Blake West and General Counsel David Schauner both appeared in opposition to the bill.

Said West, “Please consider this: during her first three years in the profession, a typical high school teacher will have taught over 2,000 lessons and worked with 400 to 1,000 or more students on a day to day basis.  An elementary teacher will have taught far more lessons.  Surely an administrator who is making appropriate classroom visits should be able to observe and determine if a teacher has grown and demonstrated professional competence within 2,000 lessons taught over three years.  If we are NOT evaluating teachers with enough frequency and rigor to determine their competence over three years, then we are failing to provide our students with the learning environment they deserve.”

Click here to read Blake West’s testimony.

Schauner began his testimony with a quote from a Kansas Supreme Court case in 1957 in which the Court expressed the rationale for granting teachers a right to due process:

“…to protect competent and worthy instructors and other members of the teaching profession against unjust dismissal of any kind – political, religious or personal, and secure for them teaching conditions which will encourage their growth in the full practice of their profession, unharried by constant pressure and fear but it does not confer special privileges or immunities upon them to retain permanently their positions or salary, nor permit their interference with the control or efficient operation of the public-school system; and, notwithstanding it grants tenure to those who have taught the requisite period, it nonetheless empowers Boards of Education to discharge then for just cause in an orderly manner by the procedures specified.”Million v. Board of Education, 181 Kan. 230, 310 P.2^nd 917 (1957)

Schauner went on to conclude, “At a time when national educational policy discussions value quality public schools and improving student performance, the creation  a larger underclass of educators works at cross purposes with that national goal.  It is important to keep in mind that under Kansas law a probationary teacher may be released at the end of his or her teaching contract with no more formality than a written letter delivered by the statutory deadline telling them that their services are no long needed.

That lack of job security strikes at the heart of why Kansas created a due process system in the first place.  ‘To protect competent and worthy instructors… against unjust dismissal of any kind - political, religious or personal,  and secure for them teaching conditions …unharried by constant pressure and fear.’”

Click here to read David Schauner’s testimony.

Also appearing in opposition to the bill were Wichita peer consultants Charlotte Bartsch and Amy Snodgrass. Bartsch and Snodgrass both pointed out how support programs in the first years of teaching work to create highly effective teachers in the three year probationary period. They argued that to keep a teacher who has not demonstrated that they have the skills to be an effective teacher beyond three years simply exposes more children to someone who should have chosen a different profession. National Board Certified Teacher Andrew Davis submitted written testimony in opposition.

Click here to read Charlotte Bartsch’s testimony.

Click here to read Amy Snodgrass’ testimony.

Click here to read Andrew Davis’ testimony.  

House Bill 2699 is about gaining the ability to non-renew more teachers without any rationale. It is all about balancing the district’s budget without having to explain the decision-making process or look at other cost savings including shrinkage in the central office.

KNEA strongly opposes this attack on teachers. To take advantage of a fiscal crisis and use it as an excuse to diminish teacher rights suggests a lack of respect for the teachers who serve our children every day in every classroom with fewer and fewer resources.  Effective administrators don’t need nearly twice the current probationary time to recognize quality teachers and provide them the rights they have earned with their service; they should want to welcome them fully into the profession.

No action was taken on the bill. We will be watching for it to reappear for debate at a later date.

Senate Ed hears from Post Audit Committee on consolidation, special ed aid

The Senate Education Committee heard from Senator Terry Bruce (R-Hutchinson), chair of the Legislative Post Audit Committee, on the LPA consolidation study. Bruce gave a very clear description of the issues in the study and the considerations of the Committee. He pointed out that there was very little money to be saved by forcing consolidation and that the best approach was still to provide incentives to encourage local consolidation.

Bruce and Senator John Vratil (R-Leawood) both suggested that with a few more years of budget cuts, it was likely that we would see lots of consolidation happening out of necessity. Bruce referred to this as “consolidation by starvation.”

Scott Frank from the Division of the Legislative Post Audit briefed the committee on issues of special education funding. Frank had come to the committee to do this several times before but they had always run out of time. His comments focused primarily on the disparity of reimbursements under the special education formula.

Both presentations were “information only.”

Relatively quiet day in Education Committees

The House Education Committee – with Rep. Bill Otto (R-LeRoy) in the chair – held a hearing on Senate Bill 485 which puts some controls on out of state higher education institutions coming to Kansas to offer programs. The bill has already passed the Senate. No action was taken on it in the House Committee this morning.

The Senate Education Committee heard House Bill 2433 which would exempt Regents institutions from state purchasing laws and regulations including the Prison Made Goods Act. It would also allow the Department of Corrections to sell prison made goods to the general public.

But House Ed Budget considers bill changing continuing contract law

The House Education Budget Committee held a hearing on SB 362 which would allow a school district to unilaterally change the notice date under the continuing contract law to June 1 by simple adoption of a resolution.

The bill was sought by United School Administrators and opposed by KNEA. We see no point in changing a system that has worked well for decades. While the bill is not as bad as it was when introduced – back then it set a nebulous date based on the signing of some undefined budget bill – it is still a bad idea. There is no requirement that a resolution be adopted by a date certain; there is no sunset on a bill that is being pushed as needed in these tough economic times; and there is no provision for making sure employees receive notification since the new date would be outside of the school year.

If it isn’t broken, why fix it?

Advocating for fixing the unbroken system were United School Administrators, Kansas Association of School Boards, Mike Mathes (Superintendent of Seaman School District), Diane Gjerstad (lobbyist for Wichita School District), and Bob Van Crum (lobbyist for Blue Valley School District).

Tomorrow – making it easier to balance the budget on the backs of teachers…

Tomorrow this same committee will hold a hearing on another attack on teachers from USA. This one, HB 2699, would change the probationary period from three to five years. This means that school districts could let teachers go at the end of the school year without having to justify the decision for five years instead of the current three. Obviously, it makes it easier to balance your budget if you can just let more teachers go without the worry of defending your decision.

This bill is about gaining the ability to non-renew more teachers without any rationale. It is all about balancing the district’s budget without having to explain the decision-making process or look at other cost savings including shrinkage in the central office.

KNEA strongly opposes this attack on teachers. To take advantage of a fiscal crisis and use it as an excuse to diminish teacher rights suggests a lack of respect for the teachers who serve our children every day in every classroom with fewer and fewer resources.  Effective administrators don’t need nearly twice the current probationary time to recognize quality teachers and provide them the rights they have earned with their service; they should want to welcome them fully into the profession.

Senate Ed Committee continues discussing catastrophic aid; rewrite of school finance

The Senate Education Committee once again grappled with SB 359 – the bill changing catastrophic aid. The bone of contention continues to be the proration of services by a few school districts and, in particular, the change in accounting done by Shawnee Mission that increased their claims for catastrophic aid from 0 to 333 in one year.

While Shawnee Mission did nothing that was prohibited, some legislators suggested that they were “scamming” the system. The increase created a “red flag” for many people who then decided it was time to make some changes to catastrophic aid.

As the bill was being debated in committee, the discussion eventually came to deal with what to do about districts that had used proration in calculating catastrophic aid claims. Since those claims are applied for at the end of the school year, Shawnee Mission asserted that these claims are an end of year reimbursement for expenses made in prior months. They argued that they should not have to lose that money and that any change should come later when they could budget based on the change. A motion to essentially delay implementation failed in committee.

The bill will now be considered by the full Senate.

Also under discussion today was Senator Abrams’ rewrite of the school finance formula, SB 539. KNEA testified that there were intriguing ideas contained in the bill along with some that triggered alarm bells. All-in-all, we felt that the bill deserved a much deeper discussion than it could be given in the abbreviated schedule of the committee and legislative session. The committee agreed and the bill will be sent to an interim committee for further study.

House Ed Budget Committee set to take up diminution of teacher rights

Sadly, United School Administrators, an organization that represents some superintendents and principals around the state, seems to have lost focus on what really matters by proposing legislation that attacks teachers at a time when we truly need a unified focus on fixing revenue and funding our schools.

Tomorrow, the committee will hold a hearing on Senate Bill 362 which allows school districts to unilaterally change the notice date to June 1 from the current May 1. This change means teachers will be away from the buildings and such notice will have to take place by mail allowing school administrators to avoid a face-to-face meeting with those teachers they are planning to non-renew.

For teachers wondering about the status of things for the next school year, it could keep them out of the job market for an additional month – a month that could mean the difference between having a job going without one.

KNEA has opposed this change.

On Wednesday though, things get really ugly when USA will be promoting House Bill 2699 which extends the probationary period for teachers from three to five years. Some USA members will try to characterize this bill as an expression of their respect for new teachers. They will say that they sometimes find a teacher who might just need a year or two more and it would be cruel to non-renew that teacher.

But in reality, this bill is about gaining the ability to non-renew more teachers without any rationale. It is all about balancing the district’s budget without having to explain themselves or look at other cost savings including shrinkage in the central office.

KNEA strongly opposes this attack on teachers. To take advantage of a fiscal crisis and use it as an excuse to diminish teacher rights suggests a lack of respect for the teachers who serve our children every day in every classroom with fewer and fewer resources.  Effective administrators don’t need nearly twice the current probationary time to recognize quality teachers and provide them the rights they have earned with their service; they should want to welcome them fully into the profession.

House Advances PEAK act expansion

Allows more companies to keep withholding taxes for themselves

The House yesterday advanced HB 2538, an expansion of the Promoting Employment Across Kansas or PEAK Act. PEAK was originally passed just last year and allowed for a business that was relocating to Kansas from another state or country to keep employee’s withholding taxes for a period of time if the company met certain employment and wage goals.   

This year’s amendments represented significant expansion to the Act, allowing companies that expand to take the benefit as well as companies that buy out Kansas companies to keep the withholding of employees they retain. Other changes would lower the wage requirements and allow part time employees to count.   

Debate on the floor was brisk with a number of amendments being offered and voted on. We will get a chance to review all the amendments over the weekend in time for a final action vote which will probably happen on Monday.

KPERS Committee looks at beefing up contributions

The Joint Committee on Pensions, Benefits, and Investments is looking at a proposal to shore up KPERS by increasing both the state contribution and the employee contribution. In exchange for an increase in employee contributions, the multiplier that determines one’s retirement benefit would also increase.

Under the plan – which we have yet to see on paper – the cap on the employer contribution increase would go from 0.6% today to 1% in 2012. The employee contribution would increase by 0.5% each year from 2012 through 2015. By 2015 the employee contribution would be 8% of salary. The multiplier would go from its current 1.75 to 1.85. What we don’t know at this time is if the increased multiplier will be for all years of service or just the years worked at the higher contribution rate. This is a concept that has been discussed in other meetings of the Joint Committee.

We will be watching the proposal and reporting on it again when we get the chance to actually see it in writing.

House Ed Committee examines consolidation bills

The House Education Committee had hearings today on two bills dealing with the consolidation of schools.

The first bill, HB 2627, was a simple bill giving three or more school districts the authority to enter into negotiations that would result in a merger into two districts. Currently, schools can meet to consolidate into one. This bill would address the situation where, for example, three districts would like to consolidate into two with one of those districts splitting itself between the other two.

The second bill, HB 2704, is a little more complicated. While it includes the provisions of HB 2627, it also changes low enrollment weighting such that the weighting would be capped at the 400 student level for any district that is less than 200 square miles and has an enrollment of less than 400 students. For most small school districts, the low enrollment weighting would continue to be capped at the 100 student level but this bill would address what some consider the “small by choice” situation.

It was HB 2704 that brought the most discussion with superintendents from a number of the impacted districts made the case for continuing the current situation. Most of the testimony from the superintendents centered on the excellent academic achievement of students in small school districts.

Senate Tax talks about taxing authority for tech colleges

Tech colleges in Kansas have a problem. They are stand-alone institutions that do not currently have any taxing authority. K-12 schools and community colleges have such authority and the tech colleges contend that in order to provide excellent career and technical education programs that serve the economic needs of their communities, they too need funding opportunities.

The bill under consideration, SB 548, would allow the tech colleges to assess up to 2 mills of property tax and/or a 1% sales tax to fund their programs. Each college could decide if they wanted to levy the tax and what mix/level of taxes to levy. The levies would be subject to a protest petition and vote of the electorate. This tax could be levied on the home county of the college and its service area.

Senators had a number of questions and the hearing will be continued at a later time.

Senate Ed opens hearing on massive revisions to school finance

Senate Bill 539 was heard today in the Senate Education Committee. This bill, drafted at the request of Senator Steve Abrams (R-Arkansas City) is a dramatic rewrite of the school finance formula. There are many things in this bill, some of which we could support, others we would have concerns about, and still more we simply find intriguing and worthy of more study.

The testimony heard today focused primarily on a section of the bill that would require sixth grade students to take a career assessment test and be given guidance on pursuing education congruent with the results of that assessment. Proponents of this section included representatives of the Wichita Area Technical College, other advocates for technical education, retired Manhattan Schools Special Education Director Dee McKee, and Winfield USD 465 Superintendent Marvin Estes. Former Senator Nick Jordan and Blue Valley Schools lobbyist Bob Van Crum testified in support of what appears to be a move toward more local authority.

KNEA has taken a neutral position on the bill, suggesting that it should be sent to the Legislative Education Planning Committee for more in-depth study and debate over the interim.

Said KNEA lobbyist Mark Desetti, “While we appreciate the author’s effort at ‘thinking outside the box,’ the changes in this bill are simply too enormous to be given due diligence within the limits of a session committee hearing. We think this bill merits more discussion and examination and would recommend that, if you agree there are ideas here worth considering, that you allow the Legislative Education Planning Committee to take it into consideration over the interim.”

The hearing will continue on Monday.

House floor consumed with smoking ban debate

A notable bit of political intrigue consumed the debate in the House of Representatives today as supporters of a comprehensive state-wide ban on smoking in public took the unusual tactic of moving to concur in the Senate amendments to a House bill.

The Senate had earlier passed the smoking ban in a House Bill – HB 2221. The House had its own version of a smoking ban which has been variously characterized as the “compromise bill,” “a fraud,” or simply “no ban at all.” Governor Parkinson, who supports the ban, had vowed to veto the House version if that was the one sent to his desk.

Representative Charlie Roth (R-Salina) made the motion to concur in the Senate amendments which, if adopted, would have the effect of passing the bill and sending it directly to the governor. A long debate began during which proponents including Jill Quigley (R-Lenexa), Lisa Benlon (D-Overland Park), Don Hill (R-Emporia) and Barbara Bollier (R-Mission) gave impassioned speeches on the effects of second hand smoke on non-smokers. On the other side were Brenda Landwehr (R-Wichita), David Crum (R-Augusta), and Bill Otto (R-LeRoy). Landwehr acknowledged her opposition to smoking bans while Crum objected to the exemption for casino gaming floors and Otto advocated for a vote of the people.

Rep. Don Schroeder (R-Hesston) made a motion to table the bill but that motion went down to defeat.

In the end, 68 voted to concur while 54 voted no. If there is no motion to reconsider, this will now go to the Governor’s desk where it will be signed into law. At that time, Kansas will have passed a state-wide public smoking ban.

If you are ever in the capitol when this kind of action takes place, it is great fun to watch the maneuvering and arm-twisting that goes on. It turns what often appears to be tedious business into a scene right out of Mr. Smith Goes to Washington! 

House done before noon

Five Education Bills Passed

The House today worked through their agenda rapidly this morning and was gone before noon.   

On the agenda were five bills up for final action votes. All of them passed, although two barely made it.

HB 2239 passed 64-58. This bill requires the State Board of Education to modify the uniform system of reporting to compare school district data so as to include detailed records of revenue and expenditure transactions. 

An amendment by Rep. Harold Lane (D-Topeka) directs the Legislature to appropriate sufficient funds to pay for the implementation of the provisions of the bill. 

HB 2280 passed 65-57. This bill lowers the state aid payment formula for capital improvement (bond and interest) and capital outlay aid.  Under current law, districts at the median assessed valuation per pupil receive 25 percent state aid. The percentage decreases for wealthier districts and increases as valuation declines.  The bill changes the ratio to 15 percent at the median. This effectively lowers the state aid for school districts by 10 percentage points. If a district receives 25 percent state aid, it would receive only 15 percent under this bill.

In addition, any school district of less than 200 square miles and with an enrollment of fewer than 400 students would have to receive approval from the Joint Committee on State Building Construction to receive capital improvement aid. 

An amendment would allow districts that have moved money into their capital outlay fund in the 2008-09 school year from their general or supplemental general (local option budget) fund can move those transfers back into contingency funds. Under this amendment, this money would now be available once again for general operating expenses.

HB 2410 passed 74-48.  This bill provides that if a student submits an application for free lunch and is later found not to have been eligible, the Kansas State Board of Education will exclude the student from being counted for at-risk state aid. At-risk funding is based on the number of students who qualify for free lunch but is expended on students who are at-risk of failure.

HB 2595 passed 100-22. This bill is yet another change to the current 10-mile bus rule law. It would remove the July 15 application deadline and the paperwork in order for one district to enter another district without permission to transport a child who lives more than 10 miles from the school he or she would attend in the district of residence.  

HB 2601 passed 120-2. Under the current school finance formula, levels of at-risk weighting are based on the percentage of students on free lunch. This is applied in a “stair step” fashion so that a change of just a few students could mean either a large loss of funding or a large increase for a school district. This bill changes the formula from a stair step formula to a linear transition beginning at 35 percent students eligible for free lunch. The value of the weighting rises as the percentage of students increases to 50 percent eligible.  It slightly increases the value of the weighting at 50 percent eligible and above.  The bill would not take effect until the Legislature funds the base budget per pupil at the statutory amount of $4,492, so all districts would have a much higher per pupil funding level than in the current year. 

Senate has spirited debates on texting while driving and the death penalty

No Education Bills on Their Agenda Today   

The Senate took up their agenda beginning at 9:00 this morning and got bogged down on the fourth bill, Senate Bill 351, which would prohibit texting while driving. What most people probably thought was an easy bill quickly escalated into a debate on profiling, physicians with pagers, and what happens at stop signs. The debate became heated when one opponent suggested that the sponsor was looking for political points. Senator Jay Emler (R-Lindsborg) rose in frustration and told stories of emergency responders who must deal with the bodies of young people in horrible traffic accidents. Ultimately the bill was advanced.

No sooner was that debate finished than the Senate took up Senate Bill 375 which would abolish the death penalty. The Senators rejected a motion to send the bill back to committee and the debate continued. Later an amendment was offered that was characterized as killing the bill. The debate pointed out that voting for the amendment would eliminate the death penalty abolition and voting against it would keep it moving. The amendment failed on a 20 to 20 vote. In the end, the bill was advanced on a voice vote. A final action vote will come some time tonight.

Turn Around means a little break   

We have reached the halfway point in this session. All bills must be either passed by their chamber of origin or referred to a committee exempt from timelines.

Both chambers will be off on Monday with only a little work being conducted on Tuesday. The Legislature will be back in full force starting on Wednesday, February 24.  

Under the Dome will also be taking a break for a few days. Look for our next report on Wednesday.

1:00 pm

SB 355 fails on a tie vote

Motion to reconsider could come later   

The Senate this morning voted down Senate Bill 355 on a vote of 20 to 20. It takes a majority to pass a measure and this time it came up one vote short.

Eleven Republicans joined nine Democrats in voting against the bill. Those Republicans were: Karin Brownlee (Olathe), Les Donovan (Wichita), Dick Kelsey (Wichita), Mike Petersen (Wichita), Jean Schodorf (Wichita), Bob Marshall (Fort Scott), Tim Owens (Overland Park), Ralph Ostmeyer (Grinnell), Roger Reitz (Manhattan), Mark Taddiken (Clifton), and Dwayne Umbarger (Thayer). Democrats were: Oletha Faust-Goudeau (Wichita), Marci Francisco (Lawrence), David Haley (Kansas City), Anthony Hensley (Topeka), Tom Holland (Baldwin City), Laura Kelly (Topeka), Kelly Kultala (Kansas City), Janis Lee (Kensington), and Chris Steineger (Kansas City).

A few years ago, the legislature removed retirees who return to work from collective bargaining and due process. The one right that was left to them was the right to be notified in a timely fashion whether or not they would have a job the following year. Senate Bill 355 would remove them from the continuing contract law.

We are happy that these senators made the decision to support this one right for this group of teachers, many of whom come out of retirement in high need areas such as math and science. These teachers currently work under individually negotiated contracts for a specified length of time and can be let go at the end of those contracts if the district determines there is no longer a need for that teacher.

The continuing contract law only requires that the district let the teacher know by May 1 that they will not be offered a contract. Under the provisions of SB 362 which the Senate passed earlier, a district can change that date to June 1 by passing a resolution to that effect. It would seem that this action would give the district an appropriate amount of time to determine need.

It is still possible that there could be a motion to reconsider this action. One of the Senators who voted against the bill would have to make the motion to reconsider. Motions to reconsider must come within 24 hours of the initial action.

Senate advances SB 355; final vote tomorrow

This bill would strip retirees who return to work of continuing contract law

Tomorrow the Senate will take a final action vote on the onerous SB 355. This bill, if adopted, will complete the elimination of teacher rights for those retirees who return to work.

A few years ago, the legislature stripped these teachers of their right to the provisions of collective bargaining agreements and to due process hearings in terminations. The one right that was left to them was the right to be notified in a timely fashion whether or not they would have a job the following year. Senate Bill 355 removes these teachers from the continuing contract law.

If adopted, a district could simply not say anything to the retiree who would be left wondering whether or not he/she had employment for the next year. The district could offer a contract at any time and could wait until the day before classes start in August. Of course, they could just say nothing and put someone else in the teacher’s position for the next year. And, by the way, if you are offered a contract and you want to work, sign. Once signed, a contract must be honored by both parties.

The bill was carried on the floor today by Senator John Vratil (R-Leawood) who at one point in the discussion admitted in response to a question from Senator Dick Kelsey (R-Wichita) that the bill would remove a right now enjoyed by these retired teachers. Kelsey was asking for clarification of what he was hearing from teachers in his district. Senator Anthony Hensley (D-Topeka) carried the argument that these teachers at least deserve the right to timely notice of their job status.

While the bill was advanced today, the Senate will not take the final action vote until tomorrow morning. There is still time to ask your senator to vote no on SB 355 and to treat retirees who return to work with respect and dignity.

While districts would still be free to go ahead and offer employment contracts to these teachers, it is conceivable that some will districts will wait until the last possible moment to do so, leaving them in employment limbo up until the last minute.

If you think SB 355 is wrong, click here to send a message to your senator.

New LPA studies on tax exemptions back our position on taxes

The Legislative Post Audit Committee heard two new reports from the Post Audit division that appear to support some long-held KNEA positions regarding tax policy. KNEA has been advocating for some time that the habit of granting new tax exemptions in a more-or-less willy-nilly fashion has led to a system that is out of control and not helpful to state revenue.

The two LPA studies reference a number of exemptions that appear to have no benefit to the state. They also discuss the problem with granting exemptions by name and suggest that a better policy would be to have criteria for the granting of exemptions. The studies also suggest that tax exemptions should come under periodic review and not be granted in perpetuity.

Understand that our knowledge of these studies is based on a presentation by the LPA today. We have not yet had time to fully digest the studies. We will give a more detailed report next week.

Turn around just around the corner!

It’s that time of year! All bills must be either advanced out of the House of Origin or “blessed” (referred to a committee that is exempt from legislative timelines) by Saturday. That means legislators on Thursday and Friday will spend the entire day on the floor debating those bills that have been passed by committees and trying to get them sent on to the other chamber.

We expect both chambers to meet all day Thursday and Friday. They have reserved Saturday for work if needed. While we don’t expect Saturday meetings, one never knows what kind of debate will slow things down. Today for example, the House dealt with an insurance bill that was loaded up with an abortion amendment (always a long debate) that would require abortion procedures to be a rider to a policy – your insurance policy would not cover abortion unless you bought the rider. By the time debate was finished they had added rider coverage for smoking related diseases and erectile dysfunction! Ultimately, the bill was sent back to committee but it gives you an idea about how the process can come to a grinding halt every once in a while.

Monday and Tuesday of next week will be days off before legislators return for the second half of the session on Wednesday.

Sales tax exemption hearing wraps up; action taken on tax cut moratorium

The House Taxation Committee wrapped up its four day hearing on HB 2549, the KACIR bill repealing a number of sales tax exemptions. Today’s topic was the proposed repeal of the state sales tax exemption on residential utilities. While many thought this would be the most controversial part of the bill, it actually turned out to be the easiest day with no proponents and only two opponents. One assumes all the utilities chose two representatives of the industry and let them do all the testimony.

The committee came to no decision today and did not begin debating the bill. They did, however, take action on House Concurrent Resolution 5028 which was a non-binding resolution calling on the legislature to take a three year break from issuing new exemptions or tax breaks involving employee withholding taxes.

Opponents claimed that the restraint would be like hanging a “closed for business” sign on the door of the state. Proponents argued that when the state is in such a budget crisis we can’t continue to just cut revenues.

At one point it was asked why the committee was acting without having seen the new post audit studies on economic development. Asking where those studies were, one legislator commented, “Apparently they’ve been too busy out auditing school districts to finish these.”

A motion to pass the resolution out of committee favorably was defeated. The end of the moratorium!

Ways and Means subcommittee on the department of education begins its work

The Senate subcommittee charged with making recommendations on the education budget began working today over the lunch hour. Today was spent first in hearing from Deputy Commission of Education Dale Dennis on the condition of the education budget and requests for enhancements from the department.

The State Board of Education has asked that the legislature fund the law – that is restore BSAPP to the level in statute and restore many of the budget items that were either cut or zeroed out. Those items include professional development, mentoring, and support for national board certified teachers among others.

Mark Tallman of the Kansas Association of School Boards and Mark Desetti of KNEA were both given the opportunity to testify. Tallman focused on data supporting increased levels of funding for schools while Desetti talked of the potential for long term damage to the system – and student learning – if the legislature doesn’t act before the federal stimulus money disappears.

These hearings and discussions will continue tomorrow. The subcommittee is chaired by Senator Jay Emler (R-Lindsborg) and includes Senators John Vratil (R-Leawood), Jean Schodorf (R-Wichita), Ruth Teichman (R-Stafford), and Janis Lee (D-Kensington).

Senate Education takes action on catastrophic aid

The Senate Education Committee today made a decision on the catastrophic special education aid issue, adopting Senate Bill 359 after accepting an amendment by Senator Steve Abrams (R-Arkansas City ).

Senate Bill 359 would raise the threshold from its current $25,000 to $56,400 and adjust it for inflation in the future. The bill would also eliminate “double dipping” – the practice of charging the state twice for certain services such as transportation where it currently can be charged once for the child as a general ed student and again as a special education student.

The issue of catastrophic aid came up when claims jumped dramatically. In Shawnee Mission School District alone, claims went for zero to 333 in one year thanks to a change in the way SMSD accounted for services. What the district did was within the law but it raised a great deal of concern state-wide since catastrophic aid is taken off the top of state special education aid and what is left is distributed around the state on a per teacher basis. 

Abrams allowed his amendment to apply prospectively only and told the committee, “I don’t want to make it retroactive even though I think they (presumably SMSD) scammed it.”

Johnson County legislators were upset about the amendment and the bill because they say it sweeps money away from their school districts that has already been built into their budget. They say that their school districts have budgeted for the money and, since claims for catastrophic aid are not submitted until after services have been provided (at the end of the year) this represents a loss of reimbursement for costs already incurred. Other legislators think the money is used for the following year’s programs since the district would already have paid the bills for the current year.

It’s an interesting question made more complicated by the excess cost reimbursement issue – Remember the 92% we reported on yesterday? Look for that debate to become, dare we say, “more spirited,” in the weeks to come.

Full Senate adopts change to continuing contract law

One Republican joins the Democrats in voting to protect continuing contract

Late this afternoon, the full Senate adopted Senate Bill 362 changing the continuing contract law for all teachers. Under the provisions of this bill, the local board of education can unilaterally change to notice date from May 1 to June 1 simply by adopting a resolution. KNEA opposed the change which was requested by United School Administrators.

If the resolution is adopted, teachers in those school districts will effectively be strung along in the hopes that enough funding will be appropriated to preserve their jobs. In the meantime, they will have lost a full month in the job market making it all the more difficult to find a new job should they ultimately be let go. KNEA argued that it was kinder to let teachers know early of budget problems that might effect they job status and let the teachers decided for themselves whether to wait in hopes that things will improve or get immediately into the job market in order to ensure they can meet their financial obligations.

Besides the loss of time in the job market, there are a number of other problems with the bill. It was sold as an issue of concern in these difficult economic times but it continues in perpetuity. There is no sunset even though the proponents in committee suggested there should be one. It does not require that the resolution be adopted in a timely fashion, leaving it up to the school board to make this decision entirely at their own discretion. And finally it makes no provision for how teachers should be notified of non-renewal when the notice date comes after school is out for the summer. Without the guaranteed ability to see the teacher personally, how is one to be sure the teacher even knows of the district’s decision?

This is not a teacher-friendly bill but there were only 10 votes against it on the floor of the Senate. All nine Democrats voted NO and were joined by only one Republican, Senator Bob Marshall (R-Fort Scott). Marshall had also expressed concern for teachers kept out of the job market during committee discussion.

Senate will act on SB 355 tomorrow

This bill would strip retirees who return to work of continuing contract law

Tomorrow the Senate will debate the even more onerous SB 355. This bill, if adopted, will complete the elimination of teacher rights for those retirees who return to work.

A few years ago, the legislature stripped these teachers of their right to the provisions of collective bargaining agreements and to due process hearings in terminations. The one right that was left to them was the right to be notified in a timely fashion whether or not they would have a job the following year. Senate Bill 355 removes these teachers from the continuing contract law.

If adopted, a district could simply not say anything to the retiree who would be left wondering whether or not he/she had employment for the next year. The district could offer a contract at any time and could wait until the day before classes start in August. Of course, they could just say nothing and put someone else in the teacher’s position for the next year. And, by the way, if you are offered a contract and you want to work, sign. Once signed, a contract must be honored by both parties.

If you think SB 355 is wrong, click here to send a message to your senator.

Guest Commentary: A Call for Collaboration

Blake West, President, Kansas  National Education Association

Each evening during the legislative session, the arrival of Under the Dome (UTD) in my in-box brings me the assurance that I’ll soon understand the latest happenings at the Kansas Legislature.  Today is a rare occasion when someone besides Mark Desetti, KNEA Director of Governmental Relations, provides the text of UTD and I hope you’ll forgive the break from his excellent writing for this special topic.

Thursday, February 11, I received a phone call from a member of the Kansas legislature who was very concerned about specific passages in UTD on Feb. 9 and Feb. 10.  After listening carefully to his concerns, I felt a couple of points from UTD really could be clarified.  Here are the particular points of interest with quotes from UTD and alternative language that I think may be more accurate.

Item 1 - February 9:  “If SB 355 is adopted, a retiree who has come out of retirement to help out a school district that can’t find a teacher will be fired as soon as the district can find someone who will work for less. If adopted, a retiree could be fired the day before classes start. This is apparently your reward for a lifetime of service.”

The original language may incorrectly lead someone to believe that a teacher returning from retirement can be fired at any time even after they have a contract.  Here is a better wording.

Alternative language:  If SB 355 is adopted, a retiree who has come out of retirement to help out a school district that can’t find a teacher can simply not be given a contract in a timely fashion leaving that teacher in employment limbo up until either the district decides to offer the contract or not. This teacher could find him or herself waiting and waiting only to find the day before school starts that there is no job. Of course, if a contract is offered earlier, the district and teacher would be obligated to honor that contract.

Item 2 - February 10:  “If passed, Senator Vratil will have successfully stripped retirees who return to work in an effort to help school districts seeking qualified teachers of their guarantees to wages, hours, and working conditions through the collective bargaining agreement; he will have stripped them of their right to a due process hearing if fired; and he will have stripped them of their simple right to receive a timely notice under the continuing contract law.”

This phrasing might be read to imply that SB 355 has the effect of ALL of the changes listed – loss of collective bargained agreement rights, due process rights, and timely notice of continuing contract.  Actually, it is not this one bill or one legislator’s proposal that causes all of the harm… Here is an alternate wording that might have been better, noting the responsibility that the legislature at large had in removing the rights of retirees.

Alternative Language:  If passed, Senator Vratil’s bill will strip retirees of their simple right to receive a timely notice under the continuing contract law. The legislature will have successfully stripped retirees who return to work in an effort to help school districts seeking qualified teachers of their guarantees to wages, hours, and working conditions through the collective bargaining agreement; of their right to a due process hearing if fired; and now the minimal right just to be notified in a timely fashion whether or not they will have a job the following year.

Concluding thoughts:  I am truly glad that these points were called to my attention.  Along with the 25,000 members of KNEA, we take the reputation of our association in matters of advocacy very seriously.  The common political thing to do these days is to apply “spin” to any situation when someone speaks unclearly or in error.  But we demand a higher level of integrity for our work – it may mean that we don’t have quite as much political influence, but teachers – our members – approach our work with both high principles and a vision for what is possible as we work for great public schools. 

Beyond our efforts to be completely accurate in our communications, I must share another concern.  We face such difficult times both with our state’s economy and with education policy and funding.  These times demand the best possible problem solving from both educators and policy makers.  Yet we find all too often that the first time teachers learn of legislation proposed to impact their professional work is when a bill is distributed through the Capitol print services.  This is extremely poor problem solving.   We have learned in schools that students and their parents need to be involved when designing Individual Education Plans.  Similarly, the professional voice for teachers should be given the opportunity to work collaboratively throughout the design of legislation that impacts our schools and the working conditions of teachers. 

It’s time to utilize the expertise of those people with the deepest insight into how to ensure great schools in every community and great teachers in every classroom.   Legislators must lay partisanship aside and partner with the teachers who have a vision for great schools for every child in Kansas.  Some will choose not to do this.  But for those who understand that public education is fundamental to the economic future of the state and to the quality of life in our communities, let’s change the way of doing business.   If we can make collaboration and problem-solving the new norm for development of education policy, possibly our legislature could (like Kansas schools) find itself to be among the best in the nation.

Sales tax exemption hearing still going on

The House Tax Committee hearing on HB 2549, the KACIR bill repealing a number of sales tax exemptions, was in day three today. There were plenty of opponents lined up today.

One of the most often cited exemptions was the repeal of sales tax on charitable bingo games. There are a number of organizations that use bingo for their fundraising activities – Catholic charities, American Legions, VFW’s, and others. Most expressed concern that the imposition of the sales tax would put them at a competitive disadvantage with casinos. One opponent suggested that this tax would close senior centers and be like turning our backs on our veterans.

The Kansas Lottery objected to one section that would have the impact of prohibiting the sale of out of state lottery tickets. The Laundromat industry was concerned partly because the sales tax on their service was regressive and partly because their machines can only take quarters – to apply a 12 cent per cycle tax would require an additional 25 cents from the consumer.

The Kansas Chamber of Commerce objected to one repealer calling it “the proverbial ‘nose under the tent’ on taxing services and that’s a road we don’t want to go down.” The Greater Kansas City Chamber of Commerce expressed that while they were opposed to generally applying a sales tax to services, they were not opposed to a general increase in sales or income taxes recognizing that they had some responsibility to fund the important state services they enjoy.

The hearing will continue tomorrow with testimony specific to the proposed repeal of the state sales tax exemption on residential utilities.

Senate Ed takes up catastrophic aid bills

The Senate Education Committee was scheduled to work Senate Bills 358 and 359, both of which deal with changing the threshold for catastrophic special education aid. The legislature is wrestling with the issue due to a dramatic increase in the number of claims on catastrophic aid.

Catastrophic aid is taken off the top of the funding for special education aid each year, leaving what is left to be distributed on a per-teacher basis. The more catastrophic aid claims there are, the less money is available on a per-teacher grant. The increase in claims came as a result of a change in accounting and was due mostly to the Shawnee Mission School District. While Shawnee Mission did not do anything that was not allowed, their change caused catastrophic aid claims in the district to go from 0 to 333 in one year.

Both senate bills increase the threshold for catastrophic aid to a much higher level ($36,000 in SB 358 or $56,400 in SB 359) than the current $25,000 level.

The Committee was unable to come to agreement today and will continue the debate tomorrow.

Another central part of the whole special education funding debate is the reimbursement of excess costs. Under statute, districts are supposed to receive reimbursement for 92% of the excess costs of special education. In reality because of the way the funds are distributed some districts receive far less than 92% while others receive far more.

Some of the Johnson County schools appear to be hit particularly hard for a number of reasons – one we would note is that if you pay your teachers well, you receive a lower reimbursement because the same dollar amount per teacher is distributed across the state. That dollar amount is a greater percentage of a $35,000 salary than it is of a $45,000 salary. Because of this, Senator John Vratil (R-Leawood) offered an amendment that would calculate each school district’s actual excess costs based on prior year’s student and special education enrollment and tie the reimbursement to that number. Since the statute says the state will reimburse 92% of excess costs, this would change it from a reimbursement based on the state to one based on the district and would likely eliminate the wide disparities.

Senator Vratil’s amendment was not adopted but we expect the Committee will return to this topic after the turnaround break. The amendment may or may not be the best way to address the situation but the disparity certainly bears closer examination. While some disparity may be unavoidable, it seems that the range – it was found in a 2007 audit to go from a low of 45% to a high of 207% - is far too wide. Johnson Count districts make up half of those in the bottom 10 state-wide in special education reimbursement.

Supreme Court will not reopen the Montoy school finance lawsuit

In a decision handed down this morning the Kansas Supreme Court  rejected an attempt to reassert jurisdiction over the school finance litigation (Montoy). The Court cited concerns about whether the plaintiffs still had standing to sue and importantly found the plaintiffs would go through essentially the same process if they filed a new lawsuit with new parties and a new trial. In short the process to obtain relief from the courts would not be shortened if the Supreme Court had granted the plaintiffs’ motion.

KNEA President Blake West said, “The issue is not what the Supreme Court did or did not do, but rather what the legislature needs to do NOW. Kansas children deserve a quality education this year, next year, and every year they spend in school not because the Court is arm-twisting, but because it is the right thing to do.”

The Court had been asked by Schools for Fair Funding (SFF) to reopen the school finance lawsuit in light of reductions to state aid that have cut state funding for public education. Everyone has been anxiously awaiting their decision.

House Tax Committee still hearing about
sales tax exemptions

The House Taxation Committee moved on to day two of a four-day hearing on House Bill 2549, which enacts the recommendations of the Kansas Advisory Council on Intergovernmental Relations (KACIR) on sales tax exemptions.

KACIR has recommended that the legislature repeal any exemption granted to an organization by name and some others listed not by name but by a description of the service they offer. KACIR believes – and we agree – that sales tax exemptions should be granted based on a standard set of criteria. They have suggested guiding questions for legislators to use.

Today the long list of opponents came forward but their testimony was geared not to voting down the bill but to preserving the tax exemption for their organization. Speakers today represented religious organizations, meals on wheels providers, and providers of services to the homeless, as well as the Girl Scouts and the YMCA.

The bill does include a new section which protects fundraising sales such as Girl Scout cookies or Boy Scout popcorn but it does not include any guidelines about how to determine when to grant an exemption. The opponents are giving their rational for having such an exemption and the legislature – if they want to get exemptions under control – will have to come up with some way of determining when an exemption is indeed appropriate.

The hearing will continue on Monday and Tuesday of next week.

House Tax Committee begins 4-day hearing on sales tax exemptions

The House Taxation Committee began what is scheduled to be a four-day hearing on House Bill 2549, which enacts the recommendations of the Kansas Advisory Council on Intergovernmental Relations (KACIR) on sales tax exemptions.

KACIR has recommended that the legislature repeal any exemption granted to an organization by name and some others listed not by name but by a description of the service they offer. KACIR believes – and we agree – that sales tax exemptions should be granted based on a standard set of criteria. They have suggested guiding questions for legislators to use.

There is no doubt that some of the named organizations – if not all of them – do good work. But the granting of exemptions in recent years has grown out of control. As an example, consider the Ottawa Suzuki Strings. There is no doubt that Suzuki Strings programs do good work for a lot of children but why was Ottawa Suzuki Strings singled out for an exemption? If they are worthy of an exemption should any Suzuki String organization also get that exemption?

In testimony today, KNEA lobbyist Mark Desetti asked the committee to bring exemptions under control. Secretary of Revenue Joan Wagnon pointed out that the number of sales tax exemptions has more than tripled since 1985 and the forgone revenue as a result has increased dramatically.

We anticipate that representatives of many of the organizations now listed will be appearing to defend their exemption. But we also believe, as we noted in testimony, that if the legislature uses criteria or guiding questions in granting exemptions – including the question of whether or not the agency performs a task that would otherwise fall to the state – a number of those organizations would likely still have an exemption.

The bill also contains some very controversial exemptions repeals including the repealing of the state sales tax on residential utilities. On this issue, Desetti told the committee, “We understand that you will have concerns about individual items included in this legislation. It is entirely appropriate that you debate and consider each provision as you seek to restore stability, elasticity, and progressivity to the Kansas revenue system.”

Passage of some version of this KACIR recommendation along with passage of Representative Siegfreid’s Tax Simplification Commission would be a positive step forward in bringing rational decision making into the tax process.

House Ed Budget Committee passes changes to capital outlay state aid

A bill to continue the moratorium on state aid payments for capital outlay has been amended significantly and moved out of the House Education Budget Committee.

House Bill 2280 began life as a continuation of the current moratorium on state aid payments to low-property wealth school districts to support their capital outlay program. This moratorium which was put in place last year has been quite costly to a number of school districts.

In Committee today, Rep. Clay Aurand (R-Courtland) offered two amendments, both of which passed. Aurand’s first amendment would change the moratorium on all state aid to a reduction of the state aid. Under the amendment, each school district would lose ten percentage points off their aid so a school district receiving 12% state aid would now receive 2%; one receiving 25% aid would now receive 15%. The effect of this amendment is to reduce the state’s obligation but not wipe it out entirely.

The second amendment would require that districts that have at least 200 square miles and 400 students would need approval by the Joint Committee on Building in order to get state aid.

After both amendments were adopted, the committee passed the bill out on a party line vote of 4 to 3. It will now go to the full House for consideration.

Retirees: Last Rites for your last rights

Vratil gets committee to strip retirees of notice date

  The Senate Education Committee went along with Sen. John Vratil (R-Leawood) and stripped retirees who return to work of the only professional right they had left – the right to be notified in a timely fashion whether or not they would have a job in the next year.

The Committee advanced Senator Vratil’s bill, SB 355, to the full Senate for debate. If passed, Senator Vratil will have successfully stripped retirees who return to work in an effort to help school districts seeking qualified teachers of their guarantees to wages, hours, and working conditions through the collective bargaining agreement; he will have stripped them of their right to a due process hearing if fired; and he will have stripped them of their simple right to receive a timely notice under the continuing contract law. Senator Vratil’s action classifies these experienced professionals who have worked a full career in public education as at-will employees with the same professional rights as Wal-Mart greeters.

Under Vratil’s bill, a retiree who has come back to work could be notified at any time – even the day before school starts – that he or she is no longer wanted.

Committee also monkeys with continuing contract law for all other teachers

The Committee also advanced SB 362 after amending it considerably. As originally drafted at the request of United School Administrators, the bill would have set the continuing contract date to an undefined floating date based on whenever the legislature got around to passing (and the Governor to signing) a budget bill.

Today the bill was amended so that a district would have to use the current May 1 date unless the Board adopted a resolution saying they would use June 1 instead. While better than the original bill, this one still has its problems. Sen. Bob Marshall (R-Fort Scott) thought the idea was bad for teachers (and we agree). “If a district uses June 1,” Marshall asked, “wouldn’t that be bad for a teacher since she would have less time to look for a new job?” That was our point in testimony. Delaying the date does nothing but shrink the job market for teachers who are strung along by their administration only to find themselves let go at a later date.

Both bills now go to the full Senate for debate.

House Tax Committee passes out expansion of corporate tax breaks

The House Taxation Committee passed HB 2538, an expansion of the Promoting Employment Across Kansas (PEAK) act. PEAK allows companies that relocate to Kansas, create at least 10 new jobs and pay employees a certain wage standard to keep 95% of Kansas withholding taxes for those employees for a period of up to ten years. The act is less than one year old.

Despite the fact that the act is so new and there is not yet hard evidence that it is effective, Representative Marvin Kleeb (R-Overland Park) brought a bill that would dramatically expand the act to grant the benefit to companies that expand into Kansas or buy a current Kansas operation and simply retain the employees. Kleeb’s amendment also reduces the compensation requirements under PEAK.

Kleeb was questioned on the pay element in particular during the committee debate today. Under the amendment, the average wage of the new jobs would have to meet or exceed the median wages in the county or on an industry standard. Rep. Stan Frownfelter (D-Bonner Springs) asked if he a company under his plan could pay “blue collar” jobs low wages and offset them with a couple of highly paid executives. Kleeb responded that companies wouldn’t do that; it wouldn’t be good business. Frownfelter pointed out that his amendment would certainly allow that to happen.

Another question on wages came from Rep. Julie Menghini (D-Pittsburg) who noted that when the bill was passed last year, it required the employer to provide health insurance and to pay 50% of the employee’s health insurance premium. Menghini asked that since the wage standard would be lowered in Kleeb’s amendment, the insurance standard be raised. She made a motion to amend the bill by requiring employers to pay 100% of the premium. Menghini argued that when low paid employees can no longer afford the 50% of premiums they must pay, they will go without insurance and the state will be forced to pick up the tab at county clinics and emergency rooms. Kleeb referred to Menghini’s motion as a “job killer.” The Menghini amendment was defeated on a vote of 7 to 13.

Rep. Lisa Benlon (D-Shawnee) offered an amendment to reduce the percentage of withholding kept by the employer from 95% to 70%. Benlon argued that giving companies some benefit was a worthy idea but that the 95% level was not appropriate given the budget problems the state is currently facing. Kleeb argued back that, according to Art Hall – the former Koch Industries executive that now heads up the Koch-endowed Center for Applied Economics – so many jobs would be created that the state would reap enormous benefits in sales and property taxes. The Benlon amendment failed on a vote of 8 to 12.

The bill was then passed out of committee on a voice vote. It will now go to the full House for debate.

Senate Ed Committee to vote on bills attacking continuing contract tomorrow!

The Senate Education Committee plans to work Senate Bills 355 and 362 tomorrow afternoon. KNEA is opposed to both bills.

Under SB 355, retired teachers who return to work will be stripped of their last remaining professional right – the right to timely notice under the continuing contract law. Several years ago in providing a loophole for school districts that objected to a law requiring employers to pay a KPERS surcharge for retirees who return to work, the legislature stripped those retirees of both due process rights and collective bargaining rights. This year Senator John Vratil (R-Leawood) has decided that they should be stripped of their last remaining right.

If SB 355 is adopted, a retiree who has come out of retirement to help out a school district that can’t find a teacher will be fired as soon as the district can find someone who will work for less. If adopted, a retiree could be fired the day before classes start. This is apparently your reward for a lifetime of service.

And then comes SB 362. This bill ties the notice date under the continuing contract law for other teachers to the signing into law of some undefined, nebulous budget bill. KNEA pointed out in testimony that budget bills have been signed in April while others were not signed until late July. This bill which was introduced at the request of United School Administrators would allow districts to string teachers along in the hopes that a job might be available the next school year.

KNEA argued that in tough economic times it is critical that teachers be made aware of the district’s budget considerations early enough to enter the job market. It should be the teacher’s decision about looking for and maybe taking a job elsewhere or just waiting with fingers crossed that the budget will allow him or her to continue in the current position.

It is possible that there will be an amendment offered to change the notice date from May 1 to June 1. KNEA believes this is also a problem since districts would not give notice until after school was out and there was no way to be sure that everyone affected got timely notice.

The best option is to stay with May 1. Yes, some teachers will get notices at that time. Those teachers can then individually decide if it is in their best interest to seek employment elsewhere or to stay put and hope for the best. The longer one waits to get into the job market, the less likely it is that one will find a job.

Feel free to tell members of the education committee to leave the continuing contract alone. Reject both SB 355 and SB 362. Members of the committee are: Jean Schodorf, John Vratil, Ruth Teichman, Steve Abrams, Tim Huelskamp, Susan Wagle, Tim Owens, Bob Marshall, Dwayne Umbarger, Anthony Hensley, and Chris Steineger. Email anyone of them at firstname.lastname@senate.ks.gov. For example: Jean.schodorf@senate.ks.gov.

House Tax Committee continues hearings on tax policy

Income tax credits under discussion today

The House Taxation Committee held another hearing this morning on cleaning up tax issues as recommended by the Kansas Advisory Council on Intergovernmental Relations (KACIR).

Yesterday the hearing was on a resolution to put a moratorium on all new “tax exemptions, tax credits or economic development incentive programs involving employer withholding taxes.” At issue today was House Bill 2621 which deals with certain income tax credits. The bill would repeal six under-used income tax credits and prohibit the transferability of three others.

The Department of Revenue suggested that of the six under-used credits, one should be considered for retention because new evidence suggests that it will be used. That one, the Individual Development Account (IDA) credit, invests in low income individuals often assisting them in securing housing and job training. A number of individuals appeared to ask the committee to keep the IDA credit.

The other five credits are being used by five or fewer individuals in Kansas.

The transferability issue is a little different. Under these credits, an investor from out of state who has no Kansas tax liability may transfer the credit to another individual who does. So – if I have a relative in another state who makes the investment, that relative may transfer the income tax credit to me for use on my Kansas income taxes. The KACIR recommends prohibiting the transferability of three of the four credits in statute.

Several people appeared in opposition to the prohibition on transferability of the Angel investor credit. These persons suggested that transferability was a good way to bring out of state money into Kansas.

Tomorrow the Committee will discuss what they have heard so far and beginning on Thursday will hold a hearing on HB 2549, the bill overhauling the sales tax exemptions.

Senate Tax Committee hears yet another sales tax exemption

Kansas Wildscape Foundation is building cabins in state parks

While the House is hearing bills to overhaul tax policy, the Senate heard a bill to grant yet another sales tax exemption. Senate Bill 433 would give a sales tax exemption to the Kansas Wildscape Foundation. This organization is building cabins in state parks for use by visitors. They are using inmates in Kansas prisons to build the cabins which are then placed in state parks and become part of the park facilities. Rental fees for the cabins are split between the foundation and the Department of Wildlife and Parks with the Foundation taking 75% to pay off their loans and the Department getting 25%. So far 37 of these cabins have been built.

The Foundation argues that this project will be finished in about four years and that the continuing revenue to the state from cabin rentals will be good for parks. It is reported that cabin use has been very high and since they were installed, visits to parks are up.

KNEA lobbyist Mark Desetti, representing both KNEA and KASB, argued that granting this exemption – even for this worthy organization – is contrary to good tax policy and especially bad at this time. Desetti pointed out that the legislature is considering recommendations to do away with all exemptions granted to organizations by name and putting in place a consistent, regulated policy on the granting of sales tax exemptions.

Desetti told the committee, “The policy on granting sales tax exemptions should be consistent and follow a set of rules. If you meet the criteria, you get an exemption. It often seems now that if you can find the committee room, you can get an exemption.”

Also testifying against granting new exemptions and in favor of overhauling policy were the Statewide Independent Living Council of Kansas, Kansas Department of Revenue, Kansas Action for Children, and Kansas Families for Education. 

The Kansas Restaurant and Hospitality Association also opposed the bill but for different reasons. The KRHA argued that this was an issue of competition. The Wildscape Foundation was getting a tax break for building cabins that would be in competition with motels and would not be subject to other hospitality taxes and regulations.

A few school funding bills getting hearings

No action yet

HB 2595 – students residing outside the district

This bill had a hearing in the House Education Committee. It would specify that a “brother or sister of the whole or half blood or by adoption, a stepbrother or stepsister, and a foster brother or foster sister” could go to a school in a neighboring district if he or she had a sibling already in attendance in the neighboring district. It also specifies that school buses from the neighboring district can cross district lines to transport these siblings.

HB 2539 – supplemental general state aid and litigation

Under this proposal, any school district that used its supplemental general fund (LOB) to sue the state would not be entitled to supplemental general state aid the following year. In other words, only school districts that do not receive LOB aid from the state would be permitted to sue the state.

HB 2607 – Base State Aid Per Pupil and weighting factors

This bill would increase BSAPP to $4,650 by eliminating high enrollment (correlation weighting), adjusting low enrollment weighting, and lowering all other weightings (bilingual, at-risk, etc.). The bill is revenue neutral meaning it would add no new money to schools at all. An analysis shows that most school districts would receive almost the same amount of money they get right now. The sponsor of the bill, Rep. Clay Aurand (R-Courtland), says that the bill is a simplification of the finance system and is “more honest” in how it provides money to K-12 schools.

Tax Committee considering moratorium on new tax exemptions

Non-binding resolution would cover three years

The House Taxation Committee held a hearing this morning on House Concurrent Resolution 5028 which calls upon legislators to self-impose a three year moratorium on all new “tax exemptions, tax credits or economic development incentive programs involving employer withholding taxes.”

The resolution was introduced at the request of the Kansas Advisory Council on Intergovernmental Relations. Proponents of the resolution believe that it would give the state breathing room while the economy recovers. In testimony before the committee this morning, KNEA lobbyist Mark Desetti pointed out that from 1995 until 2010 that legislature had reduced revenue by a cumulative figure of more than $10 billion. For 2010 alone, the tax cuts, credits and exemptions passed since 1995 will cost the state treasury more than $1.2 billion. These figures, by the way, include tax increases passed in the same period!

Other proponents of the moratorium were Secretary of Revenue Joan Wagnon, economist Alan Lockner, Shannon Jones of the Statewide Independent Living Council of Kansas, Missy Taylor of Kansas Families for Education, Gary Brunk of Kansas Action for Children, and Tom Laing of InterHab. Desetti spoke for both KNEA and the Kansas Association of School Boards.

This resolution, if passed, would be non-binding. It would express the intent of the legislature to stop granting so many tax breaks but would not prohibit them from doing so. Despite that, plenty of business groups showed up to object saying that the moratorium would put Kansas at a disadvantage in attracting new businesses.

In addition to the moratorium, the resolution also calls upon the legislature to put a sunset on any newly enacted cuts. This would require the legislature to re-evaluation each cut periodically and make it easy to remove one that was not helping the state.

Tax debates will continue all week as Committee Chairman Richard Carlson (R-St. Mary’s) has scheduled all of the KACIR bills for hearings this week.

Legislative Post Audit releases two new studies

Consolidation, KPERS are the topics

The Division of Legislative Post Audit released two new studies today, both of which are of interest to KNEA.

The first report reviewed the potential cost savings from the reorganization of Kansas School districts (consolidation) and the second audit reviewed how the recent economic downturn has affected the Kansas Public Employees Retirement System’s Funding Situation.

The purpose of the audit report was to evaluate the potential savings from consolidating school districts to make the system more efficient. The audit report did not consider the cost of an effective education for Kansas school children.

Two scenarios were used to illustrate the financial impact of consolidating school districts down from the current 293. The first scenario would affect districts of 400 students or less and what would happen if all were consolidated. The second scenario considered consolidating districts so no district would be less than 1,600 students. The first scenario would leave 266 School Districts and the second would leave 152.

Financial savings to the state would come from fewer teachers, administrators, support personnel and school buildings.  According to the report less money would be needed for KPERS with fewer people in the system, less money would be needed to equalize LOB’s because consolidated districts would have smaller LOB’s and less money would be needed to operate fewer school buildings.

Costs for transportation would increase for the state.  Given the manner in which the current school finance formula works many of the consolidated districts would face further reductions in funding which would be greater than the reductions than the reductions in their operating costs.

The recommendations from the LPA were that the legislature should consider options for strengthening the incentives to encourage districts to voluntarily consolidate and that the legislature limit or eliminate allowing districts to enter into long term inter-district contracts with other districts to share entire grades. The entire report is available at http://www.kslegislature.org/postaudit/audits_perform/10pa07a.pdf

The second audit found that the KPERS systems unfunded liability increased due to the downturn in the economy. Investment losses were the main cause. The audit report stated that to fully fund the KPERS group through 2033 would require a 2% to 4% increase for each subgroup.

The audit compared KPERS to similar plans in five other states. There are a total of 10 plans in the other states that, like Kansas, have just one plan. When compared with the other states, the auditors’ found that KPERS ranked near the middle on employer contribution rates, near the bottom on actuarial funding ratio, and in the bottom half on the amount of unfunded actuarial liability. However if the five state plans are combined and then are compared to Kansas, Kansas ’ unfunded actuarial liability is less than three of those five states.

The audit report made no recommendations, but observed that the legislature and KPERS will need to take many factors into consideration when considering the next course of action.

Education Budget Committee considers bill to block school employees for being paid for inclement weather days

House Bill 2591 would prohibit teachers from negotiating pay issues for inclement weather days and allow school boards to unilaterally decide to not pay teachers and other school employees for those days. At its heart this bill is about taking more rights away from teachers and balancing budgets on the backs of the employees. When the legislature cuts your budget, just don’t pay people when weather forces the cancelation of classes.

Testifying against the measure, KNEA General Counsel David Schauner said, “This push for unilateral decision making strikes at the heart of the important and respectful relationship between employees and the Board of Education. For over 40 years Kansas Boards of Educations and teachers have worked to foster a respectful relationship concerning the terms and conditions of their day to day work. To remove an important ingredient of that relationship is shortsighted and harmful.”

Kathy Cook of Kansas Families for Education also testified against the bill.

There were no proponents for the bill. Even the legislative sponsor of the bill did not come to appear as a proponent, leading on legislator to ask the chairman, “If there are no proponents for the bill, why are we having a hearing?”  

Chairman Joe McLeland (R-Wichita) closed the hearing and no action was taken on the bill.

House Tax Committee looking at expansion of PEAK tax break

The House Taxation Committee held a hearing this morning on a bill amending the Promoting Employment Across Kansas (PEAK) Act.

The PEAK act was created by the 2009 legislature to entice corporations to leave their operations in other states or countries and relocate in Kansas. Companies that did so would be allowed to keep 95% of any new employee’s Kansas withholding tax if the met certain employment and wage standards. Fundamentally, they would have to create at least 10 new jobs in Kansas which paid the average wage in the county or better. How long the company keeps the withholding tax is determined by how high the wages are.

This year, Representative Marvin Kleeb (R-Overland Park ) has proposed HB 2538, amending the act in several significant ways. First, it allows eligible companies to expand into Kansas, not just close operations and move into Kansas. Secondly, it allows Kansas companies that are expanding to be eligible. It also allows for job retention to count if a Kansas company is bought out and the employees are kept on.

Another proposed change switches the wage requirement from the average wage in the county to the median wage in the county, generally thought to be lower. In addition to the county wages, the Secretary of Commerce could use the North American Industry Classification System standards for determining the appropriate wage level. NAICS standards reflect the wages of jobs in a particular industry on a regional basis.

A mass of cities, counties, and economic development organizations appeared to testify in support of the bill. Secretary of Commerce Thornton appeared generally in support but expressed a desire to continue working on the bill to make it better – he had something of a “let’s go slow” attitude. Secretary of Revenue Joan Wagnon, while acknowledging that PEAK was not a bad idea and that she had supported passage last year, also argued that the bill needed some work. Of particular concern to her was the language on “retention of jobs.”

While most of the legislators seemed interested in the amendments, some wanted to wait until there was more evidence that PEAK was working – it hasn’t even been on the books for a year – and to see the results of an upcoming post audit study on incentives.

House Appropriations works HB 2222, the 2010 budget adjustment

The House Appropriations Committee worked HB 2222, the bill passed by the Senate that enacts the legislation necessary to finish balancing the 2010 budget. They started this work yesterday and are continuing today.

One of the most startling amendments offered yesterday came from Rep. Joe McCleland (R-Wichita) who moved to take $5 million out of supplemental general state aid (LOB support from the state for equalization of LOB levies) and move it to the Judiciary to make up their shortfall. The McCleland motion would have been devastating to property-poor school districts throughout the state. Fortunately it failed.

Today, McCleland tried two more times to take $5 million from education to send to the judiciary. One motion would take the money only from the supplemental general state aid of school districts involved in the school finance lawsuit; his other motion would have taken it from general state aid. Both motions failed.

The only motion that makes the bill different from the Senate version is that while the Senate removed the Governor’s cut to the legislature, the House put much of it back in.

The bill was moved out of committee and will now go to the full House for consideration.

February 3, 2010

New tax exemption hearing pulled from agenda

KNEA and a number of other organizations were scheduled to testify in opposition to SB 433, yet another new sales tax exemption, when we were notified that the hearing was canceled. We hope that this is good news and that legislators are beginning to realize that Kansas will not get out of the budget hole if we keep digging.

The exemption in question was for the Kansas Wildscape Foundation, a group which is putting cabins in state parks. Granting such an exemption would be counter to the recommendations of the Kansas Advisory Council on Intergovernmental Relations (KACIR) which has called for the repeal of all exemptions granted to specific organizations by name. KACIR would like to see sales tax exemptions handled under a set of standardized rules instead of the current process which sometimes seems to be “ask and ye shall receive.”

This is not the only new sales tax exemption floating out there. Just yesterday a new bill appeared, SB 493, which would grant a new exemption to yet another specifically named organization. We point out that some of these organizations might be worthy of the exemption but a system with rules seems to make perfect sense – meet the guidelines, get an exemption; don’t meet them, no exemption.

There are also resolutions to be debated that call for a three-year moratorium on all new sales tax exemptions! Meanwhile, House Taxation Committee Chairman Richard Carlson has announced that he will begin discussions next week on bills to implement the KACIR recommendations. The dome is all over the place on these issues!

What are our thoughts?

1. If you are in a hole, stop digging! Enact a moratorium on new tax exemptions and cuts.
2. Review the KACIR recommendations and bring the policy for granting new exemptions under control.
3. Conduct a comprehensive review of economic development initiatives that are based on tax exemptions/abatements. Keep those that are working, get rid of those that aren’t.
4. Keep state tax policy in the state. When the federal government creates a tax cut, consider decoupling the appropriate section of our tax code from the federal tax code. State tax reductions should be determined by state lawmakers, not congress.
5. Establish a blue ribbon commission to review the entire Kansas tax system with an eye to making it balanced, good for businesses and individuals, and stable enough to provide quality services to Kansans in good times and bad.

LPA recommends dropping some students from at-risk funding

The House Education Committee listened to the Legislative Post Audit recommendation (HB 2410) to drop some students from at-risk funding after the Sept. 20 count date. At issue is a finding by the LPA that school districts could not verify the eligibility of some 1839 students identified for free lunch.

Districts take free lunch applications at face value and report the count on Sept. 20 for school funding purposes. Every child eligible for free lunch generates at-risk weighting which is then used to provide services to at-risk students (who may or may not be free lunch students). Beginning in October school districts are called upon to conduct an audit of up to 3% of the applications to verify eligibility. Parents of those audited are asked to provide documentation supporting their application. Some children are then taken off the free lunch list either because their parents don’t respond or because they are found to be not eligible.

The post audit recommendation is that those students deemed ineligible stop receiving the attached state aid for at-risk funding. The Department of Education estimates that this would reduce overall funding to schools by about $3.3 million.

The biggest question around the issue is why we are so concerned about these 1800 students but have no concern about the potentially thousands of high school students who would be eligible for free lunch but don’t apply. It is widely known that there is a significant decline in the percentage of students on free lunch in secondary schools. Many people conjecture that secondary students are more susceptible to peer pressure and don’t wish to be identified as “in poverty.” 

Catastrophic aid debate highlights winners & losers

The Senate Education Committee held a hearing on two bills that would raise the threshold for eligibility for catastrophic special education aid. This is the funding that kicks in when the cost of providing special education services to a student becomes so high that finding the money in the district budget would have a catastrophic impact. The threshold is current set at $25,000.

The issue came to the attention of the legislature when funding for catastrophic aid doubled in one year and the Shawnee Mission School District went from zero claims for catastrophic aid to 333 in one year. Shawnee Mission, it should be noted, did nothing wrong. They just changed to a system of prorated services over their entire special education population and found that they were indeed eligible for this aid.

The big problem here is that catastrophic aid is taken off the top of the state’s appropriation for special education. After catastrophic aid is paid, whatever is left is then divided on a per teacher basis. The more catastrophic aid paid out, the lower the reimbursement per special education teacher.

The legislature called for a post audit of the situation and found several things. First, it was possible to “double dip” in the current special education funding formula. A district, for example, could get state transportation aid for a student and then claim that aid again under special education funding. They could also get double the teacher reimbursement – once for special education and again for a catastrophic claim.

There are “solutions” have been floated.

• One is to do nothing. This would likely result in 5,880 claims in 2010-11 and cost $53 million.
• Another option is to raise the threshold to $36,000, adjust it for inflation, and eliminate double dipping. Under this scenario there would 140 claims at a cost of $1.4 million. (SB 358, HB 2409)
• A third option was proposed by the 2010 Commission. This one would raise the threshold to $56,400 (2 times the prior year’s aid per teacher), adjust it for inflation, and eliminate double dipping. Under this scenario, there would be 40 claims at a cost of $650,000. (SB 359)
• A plan was also suggested by some special education directors. This plan would raise the threshold to $59,550 (2 times the prior year’s average cost per special education FTE), adjust it for inflation, and eliminate double dipping. Under this scenario, there would be 10 claims at a cost of $420,000. (HB 2580)

Proponents of SB 358 and SB 359 appeared today and argued that the intent of catastrophic aid when it was created back in 1994 was to help those districts fund the services of a few very expensive students. It was not appropriate, they argued, to “look for loopholes” in the statute or use spreadsheets to get more money. They felt that a higher threshold would return catastrophic aid to its original intent.

Speaking in support of the change were Bruce Givens, Derby USD 260; Mike Bilderback, Wamego USD 320; Bill Reardon, Kansas City USD 500; Jennifer Barnhart, Three Lakes Cooperative; Rob Balsters, Seaman USD 345; Mark Hauptman, Hays Special Education Cooperative; and Chris Hipp, North Central Kansas Special Education Cooperative.

One other proponent, Diane Gjerstad, Wichita USD 259 will appear on Monday. Opponents to the change will also appear on Monday. Expected then are Shawnee Mission USD 512, Blue Valley USD 229, and Olathe USD 233.

Every scenario creates winners and losers. And every discussion is also tied up in strongly held beliefs on the whole special education reimbursement. A big part of that debate is the finding that while the statute says districts will be reimbursed for 92% of the excess costs of special education, there are some being reimbursed at a much higher rate, others much lower. All of these issues complicate the whole situation.

Speaker O’Neal lead attorney in law suit against the state?

Honest, folks, we don’t make this up. It seems that House Speaker Mike O’Neal is the lead attorney for a group of counties and industry associations suing the state. At issue in the lawsuit is the sweeping of fees by the legislature to balance the budget in 2009.

Now we won’t comment on the lawsuit or justification for it, but we find it interesting that O’Neal who rails against Schools for Fair Funding using tax dollars to sue the state is likely being paid at least partially by county tax dollars to sue the state.

Here’s the story as it broke in the Capital Journal online this afternoon: http://cjonline.com/news/legislature/2010-02-03/house_speakers_firm_sues_state

Ways and Means begins budget contemplation  

The Senate Ways and Means Committee began preliminary discussions on the 2011 budget today with Chairman Jay Emler (R-Lindsborg) leading off.

Emler’s thoughts can best be described as “I have some good news and some bad news…” While his proposals are not as good as the Governor’s, they show no reduction to education from 2010 to 2011. Emler provides for replacement of stimulus money with state money but does not raise BSAPP as the Governor does. You may recall that the Governor provided a $50 increase in BSAPP at a cost of $32.8 million.

The good news:

There would be no reduction from 2010 funding levels for public safety, K-12 education, higher education, human services caseloads or debt service.

The bad news:

It eliminates the Governor’s recommendations to restore the Medicaid reimbursement rate cut, increase BSAPP, restore the Regents institutions operating grant, restore the judiciary operating budget, or fund the KBI DNA Lab services. It also eliminates the classified state employee under market salary adjustment.   

In the final analysis, the plan would reduce the budget deficit by about $100 million, leaving the legislature looking to find a revenue enhancement of about $300 million. The Governor’s proposed tax increases were to cover the full $400 million gap. It is clear, though, that the Chairman recognizes that there is just no more fat in the budget to be cut.  

Debate of catastrophic proportions may come to Senate Ed tomorrow!

The Senate Education Committee may be the place to be tomorrow if you want to see sparks. At issue is catastrophic special education aid and two bills changing it will get a hearing.

Currently, catastrophic aid kicks in when the excess cost to provide services to a special education student hit $25,000. The state pays 75% of the costs over $25,000. Over the years there had been a slow increase in the number of “catastrophic” students but between 2008 and 2009 it jumped from 276 claims to 758. The primary cause of the increase was a decision by the Shawnee Mission School District to prorate costs for all special education students. Shawnee Mission accounted for 333 of the 482 new claims.

Problems arise because catastrophic aid is a deduct from the overall aid for special education. In other words, of all the money appropriated for special education, catastrophic aid is taken off the top. What remains is then divided up on a per-teacher basis. If you spend more on catastrophic aid, then you reduce the per teacher reimbursement. (It’s a little more complicated than that, but that’s it in a nutshell.)

The bills being debated tomorrow would both raise the catastrophic aid threshold significantly. This would reduce the number of catastrophic claims, thereby increasing the money available for the per teacher reimbursement. As with almost any change in the school finance formula, it would create winners and losers. And so we are set up for a battle of catastrophic proportions tomorrow.

There are other bills out there to change the threshold so no matter what happens tomorrow, we are likely to watch this issue again.

Senate Ed examines two bills to diminish teacher rights

The Senate Education Committee today held hearings on two bills.

Retirees have one right left. Should we take it away?

The first, SB 355, is designed to strip retirees of the last vestige of professional rights they have – the continuing contract law. In 2006 the legislature passed a bill requiring that when a KPERS retiree returned to work in a KPERS position, the employer would have to pay the full actuarial rate into KPERS. KASB and USA objected so the legislature gave them an out. They amended the definition of teacher to take out retirees from the definition of teacher thus removing them from any salary guarantees under the collective bargaining agreement. As a result, school districts as employers were able to pass the KPERS charge onto the employees through reduced compensation.

Last year, there was a bill to take these teachers out of the continuing contract law but we worked with legislators to keep them in. This year, Senator John Vratil (R-Leawood) has again proposed a bill to take them out of the continuing contract law. If passed, this bill will cement their status as second-class teachers and allow school districts to fire them at will – even as late as the first day of school, if they so choose.

Mark Tallman, speaking for KASB, told the committee that “people who return to work should not have the same rights as other teachers.” Further, he suggested that if these retirees did not have those rights then it might keep other teachers from retiring.

This bill to completely eliminate the professional status of retirees who often come back to help districts out when they can’t find licensed teachers for hard-to-fill positions was backed in the hearing today by the Kansas Association of School Boards and The Blue Valley School District, USD 229. KNEA General Counsel David Schauner opposed the bill.

Do economic conditions demand diminished rights?

The second bill, SB 362, would essentially make the continuing contract law so nebulous that it would be nearly impossible to everyone involved to understand how to apply the law. This proposal, also by Senator John Vratil, would set the notice of non-renewal date to a time uncertain. The bill speaks to notice “not later than 15 days after the date on which the bill appropriating money for general state aid, or rescinding or lapsing an appropriation for general state aid, is approved by the governor.”

What is problematic is that there are several bills which appropriate general state aid – the so-called “megabill” is usually passed in April, but the final appropriations bill, the so-called “omnibus bill,” is rarely passed before mid to late May. And what happens when the Governor vetoes the bill? Is it then the day the veto is overridden? And what if it is not overridden? In extraordinary times, the final appropriations bill has not been passed until July. So to which bill does this proposal tie the notice date? No one – including the enthusiastic supporters of the bill – could say.

It was also pointed out that some of those bills – the omnibus bill, for example – don’t even exist in statute. The omnibus bill is something that has developed over the years and was not created as an official part of the legislative process.

Superintendents and others who appeared in support of the bill couched their testimony in concern for the plight of young teachers who might leave the district and go elsewhere if they got a notice. KNEA’s response is that stringing these teachers along until potentially just days or weeks before the start of the school year, when it was too late to enter the job market, is crueler. While no one wants to give or get a pink slip, letting teachers know there might be a problem and letting those teachers make a decision about seeking employment elsewhere or staying put hoping for the best is a much more fair system.

Speaking in support of destabilizing the continuing contract law were:

• Cheryl Semmel, Executive Director of United School Administrators,
• Mark Tallman, Lobbyist for KASB,
• Mike Mathes, Superintendent of Seaman Schools, USD 345,
• Diane Gjerstad, Lobbyist for Wichita Schools, USD 259, and
• Bob Van Crum, Lobbyist for Blue Valley Schools, USD 229.

Submitting written testimony in support were:

• Glen Suppes, Superintendent, Smoky Valley Schools, USD 400
• Beth Reust, Superintendent of Plainville Schools, USD 270,
• John Morton, Superintendent of Newton Schools, USD 373,
• Robert Lofton, President of Schools for Quality Education, a collaborative of small school districts

KNEA General Counsel David Schauner appeared in opposition.

With state budget in intensive care, Wichita legislator proposes pulling the plug

Just in case you thought your schools and social services, public safety and highways had too much money, Representative Steve Brunk (R-Bel Aire) is urging fellow legislators to get on board the newest constitutional amendment to cut funding off to as many services as possible.

Called, the REAL Act, this constitutional amendment in House Concurrent Resolution 5019, would limit increases in state spending based on a level set just after the federal stimulus money goes away, set up a “rainy day fund” and an emergency fund to store money away (isn’t that just what Brunk’s friends in Americans for Prosperity and the Kansas Policy Institute attacked schools and state agencies for doing?), requires a 2/3 majority vote to raise taxes (a simple majority to cut them), and prohibits the state from keeping revenue raised during good economic times.

REAL, by the way, stands for “Revenue, Expenditure and Assessment Limitation.” It might better be called “Reducing Everything by Abdicating Leadership” since it would tie the hands of future legislatures, stripping them of the ability to make decisions about improving the state. The end result of this constitutional amendment would be to keep state spending below the rate of inflation for services, ultimately starving programs and weakening the state’s ability to provide for its citizens.

Watch for the anti-government crowd in the Koch-funded Americans for Prosperity, the Kansas Policy Institute, and the Koch-endowed Center for Applied Economics to be all over this one.

Tax Committee hears bill on “simplifying taxes”

The House Taxation Committee held a hearing this morning on HB 2463 which would establish a “simplified state tax structure committee.” KNEA is generally supportive of this bill.

KNEA has been calling on the Tax Committees to form a special blue ribbon tax modernization commission for several years but have gone nowhere on this. KNEA lobbyist Mark Desetti and Speaker Pro-Tem Arlen Siegfreid (R-Olathe) talked about this last year at which time Siegfreid told us he had been considering just such a thing. We are happy to see that Rep. Siegfreid has introduced his version this year.

Our concerns are only relative to the fact that we would have preferred a “less political” commission. KNEA had suggested a committee of legislators, economists, and business and non-profit representatives. The committee in HB 2463 is only legislators. Siegfreid addressed some of these concerns in his own testimony before the committee today suggesting that he preferred a legislative group that would bring in many outsiders for input.

Other questions for Siegfreid were related to the political balance in the group (seven Republicans to four Democrats) and whether or not the bill seemed to suggest the outcome that the committee would come up with. We have similar concerns – particularly because the bill seems to specify certain tax reforms which are highly controversial but very popular with some very conservative think tanks.

We will, however, take Rep. Siegfreid at his word that he wants to see a thorough examination of the state’s revenue system from all perspectives and we are encouraged by this move.

No action was taken on the bill today.

Senate Ed to take on continuing contracts

Next Monday, the Senate Education Committee will hold hearings on two bills modifying the continuing contract law. The first, SB 355, would strip retired teachers who return to work of the one remaining right they actually have – the continuing contract law.

Several years ago, the legislature established these retirees as second class citizens in denying their collective bargaining rights and permitting school districts to unilaterally cut their salaries and/or benefits. The one right they were allowed to keep was the continuing contract provision that required a school district to notify them by May 1 if they were not having their contract renewed. SB 355 would complete the elimination of their rights by allowing school districts to simply drop them from employment at any time.

The second bill, SB 362, changes the notice date for non-renewals to a nebulous time related to when the Governor signs an appropriations bill. That would mean that conceivably if the legislature adjourned without an appropriations bill and had to be called back into special session, teachers would be held in limbo.

Practically, this change would have negative impacts:

In times like these when the legislature appears intent on cutting school funding but will not make the decision until very late in the session, school districts will string teachers along until it is likely too late for those that might be let go to enter a competitive job market.

For school districts, they are left in limbo in terms of recruiting replacement teachers. Moving the notice back to an unspecified time means the date by which teachers must notify school districts of their intent to leave also moves back. Teachers can then wait until much later to notify schools districts, leaving the district scrambling to find a replacement.  

Student Journalists flood the capitol!

High school journalism students came from all over Kansas today to take an up close look at the workings of the legislature and interview legislators.

First Lady Stacy Parkinson addressed the group at lunch emphasizing the importance of a quality school system and the significant difference an education makes in the life of each individual. KNEA lobbyist Mark Desetti and KASB lobbyist Mark Tallman were also invited to spend the lunch hour with them and got quite a grilling on tax policy and school funding.

The questioning itself revealed just how good journalism instruction is in the public high schools of Kansas. This was a very impressive group of young Kansans. Some of them, having made an appointment with KNEA President Blake West, made their way over to the KNEA building in the afternoon. Look for some impressive reporting in your high school newspapers!

House Tax kills sales tax increase; seeks more corporate tax cuts

The House Taxation Committee this morning rejected a motion by Representative Julie Menghini (D-Pittsburg) to table the Governor’s sales tax proposal and instead moved immediately to reject it out right on a motion by Representative Arlen Siegfreid (R-Olathe), seconded by Rep. Anthony Brown (R-Eudora).

Menghini said the action taken was “at best premature, at worst irresponsible.” She called upon her colleagues to table the bill so that more data could be brought to the committee. Noting that the committee has not heard just how deep the budget hole might become and had not had any discussion on the impact of further cuts to already crippled budgets. Menghini’s motion failed on strict party lines; Siegfreid’s passed the same way.

With AFP and the Kansas Chamber in the room, several Republicans quickly asked Chairman Carlson to have their vote against the measure recorded.

While the committee Republicans rejected this revenue increase to offset the budget gap, a new Tax Committee bill arrived today that, if adopted, will deepen the budget hole. House Bill 2538 would expand a big corporate tax break passed in an earlier session. Under current law, when an out-of-state company relocates of expands into Kansas and hires 10 employees within two years, the company is allowed to keep the employees’ Kansas withholding taxes for a period of between five and seven years. The company must meet certain wage and benefit levels in order to be eligible.

Under HB 2538, these provisions would be expanded to companies that “(1) Establish a new business unit in the state of Kansas that did not exist prior to the submission of an application for benefits under this act and locate the job positions associated with the new business unit in Kansas; or (2) retain the employees of an existing business unit located in Kansas subsequent to the qualified company’s acquisition of such business unit…” In addition, the bill strikes the provision that restricts this benefit to newcomers to Kansas. Current Kansas businesses that expand would now be eligible.

While there is not yet a fiscal impact note on the bill, we imagine that it has real potential to widen the budget gap as we emerge from the current recession.

Senate debating budget bill

As we write the Senate is in a debate on Senate Sub for HB 2222, the bill enacting the last few measures of the Governor’s current year budget plan. When the Governor enacted allotments in November, some of his budget changes required legislative action. Those changes are contained in this bill.

The Senate Ways and Means Committee made very few changes to the Governor’s proposals.

At this moment, they are debating an amendment by Senator Colyer (R-Overland Park) that would advance the use of federal stimulus funds to restore the 10% Medicaid reimbursement reduction. This would help alleviate some of the suffering from the cuts to social services for Kansans with disabilities or seniors receiving help. While the amendment helps these social service programs in this year, it would widen the budget gap for next year. Unfortunately for the budget, the federal stimulus money is just temporary.

Democrats to Republicans: “Okay, you hate the Governor’s plan, so what’s your alternative?â€

Democrats from the House and Senate held a press conference late yesterday in which they acknowledged that their colleagues from across the aisle had little interest in the Governor’s plan to balance the budget by increasing cigarette and tobacco and sales taxes. They then posed the question of what the Republican alternative is to the Governor’s plan.

So far there is no Republican alternative but it is very early in the session.

But if the Governor’s plan is as bad as some Republicans have said, we are all anxious to hear what their alternative might be. Unless, of course, their alternative is to enact the list of cuts outlined in the Governor’s budget overview– cuts that include an additional $187 million cut to K-12 education – should there be no revenue increase.

Senate Tax Committee turns down revenue solutions

This morning the Senate Assessment and Taxation Committee decided to ignore two critically important potential solutions to the state’s revenue problems.

Secretary of Revenue Joan Wagnon appeared before the Committee first on behalf of the Kansas Advisory Council on Intergovernmental Relations (KACIR) to request the introduction of a bill enacting KACIR’s recommendations on the growing problem of tax exemptions. The KACIR bill would have contained several provisions to clean up the statute on exemptions. Among the provisions are:

• Repeal all exemptions granted “by name†to a specific organization (for example, Ottawa Suzuki Strings),
• Tax all admissions to recreation activities or events, whether operated by a non-profit organization, city, county or private organization (for example the YMCA would charge tax on their health club just like private health clubs),
• Require all non-profit and religious organizations to pay sales tax on their purchases,
• Repeal miscellaneous consumer exemptions such as lottery tickets, bingo, and coin-operated laundries,
• Repeal the state tax exemption on residential utilities and the local exemption on water for residential use.

The bill would continue the exemption for non-profit fundraising events (for example, the Girl Scouts would still not have to collect sales tax on cookie sales).

If enacted, this bill would provide the state with about $200 million in revenue – about half of the budget gap we now face. The Committee, however, declined to introduce the legislation.

Wagnon next stood in for Governor Parkinson asking for introduction of a bill to increase the state sales tax rate from 5.3% to 6.3% for three years after which it would drop to 5.5% with the additional 0.2% going into the highway fund and to increase the cigarette tax rate from $0.79/pack to $1.34/pack. It would also increase the tobacco products tax rate from 10% to 40% of the wholesale price.

Once again, the Committee declined to introduce the bill.

Fortunately for those seeking an alternative to further cuts to vital state services, the House Tax Committee did introduce both the KACIR bill and the Governor’s tax bill. The Department of Revenue had hoped that identical bills would be introduced in each chamber.

It will be interesting now to see what the Senate Assessment and Taxation Committee comes up with as an alternative!

2010 Commission calls upon Legislature to “make education priority number oneâ€

The 2010 Commission was established by the Legislature in the wake of the school finance lawsuit to, among other things,

·         “conduct ongoing monitoring of the school district finance act,â€

·         “review the amount of base state aid per pupil and determine if the amount should be adjusted,†and

·         “evaluate the system of financial support, reform, and restructuring of public education in Kansas.â€

Every year the Commission, chaired by former legislator and Republican Party Chairperson Rochelle Chronister, submits a report of their findings and recommendations to the Legislature.

In this year’s report, the Commission calls upon the Legislature to do six things:

1.     The Legislature should refocus its revenue and funding priorities to make education Priority Number One.

2.     The Legislature should consider generating revenue from at least three specific revenue sources.

3.     The Commission recommends these items (early childhood education, before- and after- school tutoring and support programs, at-risk funding and programs, staff development, leadership academies, and highly qualified teachers) remain, or become, funding priorities.

4.     The Legislature should continue the three-year funding cycle.

5.     The Legislature should change the formula for determining special education catastrophic aid.

6.     The Legislature should shift the tiny-k and Early Head Start programs’ administration to the Kansas Department of Education.

The Commission even took on the tax question specifically asking the Legislature to consider three specific revenue sources: reversing previous tax cuts, increasing the state school mill levy back to its former level, and increasing the state sales tax.

Voting members of the 2010 Commission, in addition to Chronister, are former USD 500 superintendent Ray Daniels, Senator Jean Schodorf, Representative Clay Aurand, Representative Marti Crow, State Board of Education member Carolyn Campbell, former Republican Party Chairman Dennis Jones, Steve Iliff, and school administrator Emile McGill. Post Auditor Barb Hinton and Attorney General’s designee Teri Canfield are ex-officio members.

Iliff routinely submits a “minority report†to the Commission’s adopted report. Iliff disagrees with the rest of the Commissioners that public education should be “priority number one.†Iliff’s 2009 report reads like a script from an Americans for Prosperity anti-government rally. In it he calls for an end to due process for teachers, expansion of unaccountable charter schools, and vouchers and tuition tax credits. Iliff suggests that kindergarten and elementary school teachers are overpaid and that secondary teachers should get larger pay increases. Iliff calls for a ban on school district employees as lobbyists and would even prohibit your KNEA dues from being used to pay for a lobbyist. And finally, Iliff calls for the dismantling of your KPERS retirement system.

Fortunately for the state of Kansas, Iliff’s minority report is a one-man minority report.

A long day of mostly recess

Both chambers went on the floor to day and quickly took a recess – in the House until 3:00 pm; in the Senate until 10:45.

Now recess in legislative terms is never a fixed time. Senators came back late and quickly took another recess until 1:30. Come 1:30, the Senate stood at ease while the agriculture committee met at the rail to adopt a new milk bill without the controversial labeling provisions. If you’ve at all been following milk, there was a bill to restrict labels on milk indicating that they were free of bovine growth hormones. The bill was vetoed by the Governor.

Upon the resolution of the milk bill, the Senate got back to work, promptly passing it.

We had been waiting anxiously for the scheduled debate of the Senate version of the omnibus budget bill. That debate was delayed for another day as the Senate adjourned for today.

The House, after returning at 3:00, adjourned for the day.

Nothing was accomplished on either the budget or tax issues.

Rumors on the budget front

The Senate budget bill contains cuts of 2.5 per cent to all state agencies including education. This is the bill that the education community is supporting. Unfortunately, keeping the bill at 2.5 per cent means that the legislature must also enact certain revenue solutions. These solutions include the temporary suspension of the phase out of the estate tax and corporate franchise tax and decoupling from the federal tax code.

These measures would save the state $96 million but the Kansas Chamber of Commerce is demanding that they not be passed. Republican leadership in the House has pledged not to disappoint the Chamber. This led to the defeat of the House version of the omnibus appropriations bill on Friday night.

Word has leaked out that Senator Ty Masterson (R-Andover) has a plan to cut all agencies by 3 percent in exchange for not sweeping certain tax revenues into the state treasury. We have heard that his plan also includes a 2.3 percent state employee pay cut. If this is true, it would be the equivalent of a 2.3 per cent payroll tax on state employees specifically to fund accelerated tax cuts for corporate interests.

There is another rumor floating that some Senator might try a comprise position by suggesting a 2.75 per cent cut to all agencies. Whether or not that proposal includes the state employee payroll tax is unknown.

None of this will be known for certain until the budget debate begins and amendments are offered. Maybe tomorrow?

Senate Tax Committee to meet tonight

In other interesting developments, the Senate Tax Committee has announced a meeting tonight. This might be a sign that some may want to consider the revenue solutions we spoke of above.

If they do and a tax bill with the revenue solutions can pass, then we might just see the budget logjam break and a reasonable budget get passed.

We’ll be watching tonight.

Kansas Chamber demands continued tax cuts!

Speaker O’Neal agrees

We reported early this session that the Kansas Chamber of Commerce was unwilling to help in the budget crisis. They took offense and, after a conversation with them in which they said they were open to temporary suspensions in some tax cut phase-ins, we softened and gave them credit for at least considering helping out.

Well, we should have stuck to our first impressions! Today, the Chamber put out a press release in which they drew a line in the sand on the legislature’s “revenue solutions.” And House Speaker Mike O’Neal was the first to toe the line.

After a Chamber press conference this morning, O’Neal announced that there would be no “tax increases” coming out of the House. He announced opposition to the proposed suspensions of the phase in of the elimination of the franchise tax and estate tax and decoupling from the federal tax code.

The Chamber and O’Neal are considering these non-tax increases to be tax increases because businesses were depending on the cuts. The suspensions on the franchise and estate tax reductions simply hold the tax cuts temporarily and then continue the phase out at a time certain. Decoupling provides business with large federal tax cuts but does not apply the same cut to Kansas. The vast majority of the tax cut is in the federal relief.

So, simply put, there has been no tax increase proposed. Business will still get the tax cut, just on a longer timeline. By doing so, they would be softening the impact of large budget cuts to public safety, education, and services to the disabled. Sadly, they are more interested in keeping tax cuts for themselves on high speed than helping solve the budget crisis.

We need to be clear that this is the position of the STATE chamber. Many local chambers disagree and are willing to help keep state services intact.

Now, in looking at the characterization of these tax freezes, we are fascinated by the fact that the same logic is not used in characterizing cuts to education. The 2008 Legislature promised K-12 schools a $59 increase in BSAPP and an additional increase to match the consumer price index in 2010. But the House funding plan would come in a full $297 per pupil below the level passed by the legislature in 2008. They will tell you that’s not a cut, it’s just not appropriated.

Why does the Chamber think they should be held harmless?

Here’s what the Chamber says: “Increased taxes in Kansas will only intensify the problem [the recession] and cause more Kansas job losses…” Ignoring the fact that no one has proposed a tax increase, will cutting schools, social services, and other state services not result in job losses? Or could it be that public sector jobs are not “real jobs” in the eyes of the state Chamber? Do the salaries of Kansas state employees and teachers not spend in Kansas businesses?

We are not comfortable with job losses in Kansas – but our comfort level is not different for public and private sector jobs. A lost job is a terrible thing. But the simple fact is that what we need in this economy is spending. And public sector salaries spend just like private sector salaries. Kansas cannot afford job losses. That is exactly why there are no proposed tax increases for business in the legislature. That is exactly why many legislators have asked business to help by slowing down the implementation of already enacted business tax cuts.

We should also not forget a few other facts about tax cuts enacted in the past few years. In a memo from the Legislative Research Department, it was revealed that tax cuts enacted over the last four years reduced 2009 tax collections by $143 million and will reduce 2010 tax collections by more than $180 million. According to the memo, “From a cumulative standpoint, tax cuts enacted the last four years are about $1.135 billion…” We added the emphasis and yes, we said “billion.”

Balancing the budget on the backs of state employees

O’Neal, in his press conference, suggested that the state enact state employee “furloughs.” Under this scenario, state employees are told they will work one day less every month and have their pay docked accordingly. Slashing the income of these employees would be roughly the fiscal equivalent of asking business to stick to the current state tax code instead of applying federal code to Kansas (the decoupling proposal). This would give business a tax cut and let state employees pay for it. And let’s not forget that this would take millions of dollars out of the Kansas economy in pay that would not be spent in Kansas businesses!

Are we not workers? When you lay us off, do we not stop spending?

Well, yes, we teachers, administrators, and school support staff are workers. We do stop spending when we have no income.

We have been in contact with our 18 field offices throughout the state and are finding very significant reductions taking place everywhere. Districts are preparing to eliminate as many as 1000 employees including large numbers of administrative, teaching, and support staff positions. And these numbers were reported before action is taken by the legislature on further cuts.

While some of these positions will be handled through attrition – retirements and declining enrollment adjustments – many will simply have to be taken right out of the current staff resulting in larger class sizes and fewer supports for students.

To paraphrase (ever so slightly) our good friend William Shakespeare: “Hath not a teacher hands, organs, dimensions, senses, affections, passions; fed with the same food, hurt with the same weapons, subject to the same diseases, heal'd by the same means, warm'd and cool'd by the same winter and summer, as a private sector employee is? If you prick us, do we not bleed? If you tickle us, do we not laugh? If you poison us, do we not die? If you do not pay us do we not suffer?   And if you wrong us, do we not revenge? If we are like you in the rest, we will resemble you in that.”

So ask your legislator – Are we not workers? Do we not contribute?

Ways & Means subcommittee on education continues their hearing on 2010 budgets

The Ways and Means subcommittee on the education budget heard from a number of superintendents from around the state last night who outlined the impact of the 10% cuts being considered by the Senate.

Their testimony was quite compelling and one hopes that the Senators had open ears. It is clear that cuts of that magnitude cannot be absorbed without having a very negative impact on student learning and student success.

After adjourning at 6:00 last night, the committee began again this morning at 7:00 am. Among those testifying today were KNEA lobbyist Mark Desetti, KASB lobbyist Mark Tallman, USD 259 lobbyist Diane Gjerstad and USD 501 superintendent Kevin Singer.

KASB focused on the achievements Kansas schools have made with the increased funding that came as a result of the Montoy lawsuit while KNEA took on the question of declining state revenues.

The subcommittee will begin their deliberations sometime late this afternoon.

Prop K hearing extended yet again

The House Taxation Committee continued their hearing on HB 2150 – the so-called “Proposition K” – which is modeled on the California property tax limits, known as Proposition 13. Today they began to take the opponents and managed to get through only a couple of them in the time allotted. The hearing will continue Monday of next week. KNEA lobbyist Mark Desetti and KASB lobbyist Mark Tallman are both ready to go and just waiting to be called!

Proposition 13, the model for HB 2150 took effect in the late 70’s and fueled a downward spiral in education funding in the state that eventually led to the elimination of many student programs and dramatic increases in class size. It took what was once the nation’s premier education system and defunded it.

Proposition K as drafted in HB 2150 would be create a much faster downward trend in state revenue for schools and other state services because it doesn’t have any of the “safe-guards” that were in Proposition 13.

Proponents keep insisting that the Kansas property tax system is unfair and everywhere these legislators go, they get complaints about property taxes. Our position is that the system we have is not unfair; in fact it has been consistently evaluated as one of the fairest systems in the nation. The problem is that our legislators have been cutting so many sales and corporate taxes that local units of government have had no choice but to rely more heavily on the one tax source they can access – the local property tax. Complaints are not based on fairness but rather on the rate at which it has been going up.

What is even crazier is that, while this legislature is proposing big cuts to services and promising to keep a lid on taxes, they are moving bills to expand the authority of schools to raise even more local property taxes!

Read more about Proposition K by clicking here.

KNEA opposes limit on community college tax levies

In the Senate Assessment and Taxation Committee, a hearing was held on SB 266 which limits the annual increase in revenue collected by a community college property tax levy to no more than 103% of the revenue collected in the prior year. KNEA lobbyist Mark Desetti spoke against the bill, saying

“Community colleges will be asked to absorb a cut of some amount next year. They will obviously be looking for ways to streamline their operations but they will also need to examine their property tax levies to offset at least a portion of any state cut. If the state were to cut their funding by 10% or more, the capped property tax levy would not allow them to meet those cuts. They would then have to turn to their other source of revenue – student tuition and fees.

“The end result would likely be a dramatic increase in student tuition and fees possibly pricing some students out of the system or forcing them to rely more on student loans and increasing their debt burden.

“We would point out that in an economic downturn, residents often turn to community colleges for education and job training in order to fit into the new economy. Harming the ability of people to access post secondary education and training would have a detrimental effect on economic development as well as the job opportunities of working Kansans.”

Combining this cap with the kinds of cuts being discussed in the Senate Ways and Means Committee, would guarantee massive increases in student tuition and fees at the community colleges – effectively pricing many out of post secondary educational opportunities.

The Kansas Association of Community College Trustees and John Masterson, President of Allen County Community College also appeared as opponents.

There did not appear to be strong interest in advancing the bill among the committee members.

Senate Tax Committee changes its mind!

The Senate Assessment and Taxation Committee reversed course today and introduced the tax bills they declined to introduce last week. These include the Governor’s 1% sales tax increase and the cigarette and tobacco tax increase.

We reported last week that no one would make a motion to introduce the bills after a presentation by Secretary of Revenue Joan Wagnon. It had been the first time in most observer’s memories that a committee did not give the Governor the courtesy of introducing his or her legislation.

This means now that the bills have been introduced in both the Senate and House.

House Tax Committee to hold hearing on sales tax increase

The House Tax Committee will be holding a public hearing tomorrow and next Tuesday on the Governor’s sales tax increase. Chairman Richard Carlson (R-St. Mary’s) had listed the agenda as a committee discussion but changed course yesterday afternoon, announcing that the committee would hear from proponents tomorrow and opponents next week.

KNEA will be among those testifying in favor of a revenue solution to stop further cuts to education and other vital state services.

Ways and Means Committee advances supplemental appropriations bill

A bill containing the Governor’s recommendations to balance the current year budget has been advanced by the Senate Ways and Means Committee. The bill would put into effect aspects of the Governor’s November allotments that required legislative action.

There was not a lot of debate on the bill and only two relatively minor amendments were made.

Senator Jay Emler (R-Lindsborg) amended the bill with a proviso limiting legislator’s franking privileges to 50% of what is allowed under policy. Franking privileges refers to a mail allowance that legislators have to communicate with their constituents. Here in Kansas, the franking allowance is very small, not even allowing a Senator to send out one newsletter to all his or her constituents. Still, the amendment would save the state $125,000.

Senator Vratil amended the bill by reducing the cut to the legislative branch of government by $1.1 million. There would still be a cut of $1.6 million to the legislative branch. Vratil felt that all three branches should be subject to similar cuts (the cut to the administrative and judicial branches was about 5% while the cut to the legislative branch was about 10%). He further expressed concern that with the full cut, there would only be enough money for a session of 83 days as opposed to the normal 90 day session.  While this amendment passed, it was not unanimous. Senators Laura Kelly (D-Topeka), Mark Taddiken (R-Clifton), and Jean Schodorf (R-Wichita) voted no.

Ultimately the bill was rolled into a House Bill and moved out of committee. It will now go to the full Senate for consideration.

New funding idea introduced

The new idea of the day is Senate Bill 385, introduced by Senator John Vratil (R-Leawood). This bill which appeared in print today enacts the “temporary education economic recovery act.” Under the provisions of the bill, and school district could make up the difference between the statutory base state aid per pupil amount and the actual amount appropriated by increasing local property taxes as an additional LOB amount. The additional LOB in the bill would be equalized.

The bill is certain to generate a lot of spirited debate. There are those who want no cap on the LOB, others who want to lower the LOB, some who won’t want to spend the additional LOB aid the bill would require, and a whole host of others who will line up on one side or the other for one reason or another.

And, yes, you’re right! The bill is essentially a local tax increase. One wonders why those who are comfortable with this tax increase are uncomfortable with a state tax increase.

House Ed Budget Committee hears reports from Post Audit

The House Education Budget Committee listened to reports from the Legislative Post Audit on a whole variety of their recent studies. Among the studies were:

K-12 Efficiency Audits,

K-12 Standardized Accounting,

Special Education Catastrophic Funding,

Issues Related to the Kansas State High School Athletic Association, and

State Universities Efficiency Audit

This was the committee’s first meeting and was informational only. All of these reports have been heard by other committees earlier.

You can find any of them at the Legislative Post Audit web site: http://www.kslegislature.org/postaudit/audits_latest.shtml

Budget provides for small increase in K-12 funding

But if it’s not passed, things look dire!

Governor Parkinson’s budget includes a $50 increase in funding for base state aid per pupil (BSAPP) while keeping LOB aid and special education aid flat. But doing any of this is dependent upon legislators getting serious about revenue and passing an increase – if not the Governor’s proposals on cigarette and sales taxes, then something at least equal.

Accompanying the Governor’s overview of the budget and included in briefings being given to legislative committees this week, is a list of cuts that will be necessary to balance the budget if new revenue is not generated.

Included in the list is a reduction of over $187 million to K-12 general state aid – primarily BSAPP. The mentor teacher program would be eliminated completely and there would be an additional $25 million cut to the Regents.

The long list of cuts to other agencies includes $675 thousand from nutrition programs for the elderly, $1.3 million to community developmental disability organization grants, $7.3 million to the Department of Corrections saved by releasing inmates early and closing cellblocks.

Further cuts would seriously jeopardize the education, health, and safety of all Kansans and are simply not acceptable. Kansas NEA will continue working with other organizations through Kansans for Quality Communities to defend the services that strengthen our communities and enhance the quality of life in Kansas.

See our brief analysis of the Governor’s K-12 proposal at http://www.knea.org/legislative/financeinfocus/images/parkinsonbudget.pdf.

You can see the list of cuts to state services in the Governor’s Budget Report overview at http://budget.ks.gov/gbr.htm.

Schools for Fair Funding asks court to reopen Montoy

Schools For Fair Funding, the umbrella organization that brought the successful school finance lawsuit (Montoy) against the state, has asked the Supreme Court to reopen the case in light of the cuts to education funding made in 2009.

With foundation funding down to the 2006 level, SFF contends that the progress made after the suit has essentially been wiped out.

Many more school districts have joined SFF in light of the 2009 actions.

A number of legislators are criticizing SFF for using resources to launch another court action at a time when resources for school districts are scarce. This logic begs the question of when school districts should sue. If schools were given the resources to do the job demanded of them by the legislature and congress, they don’t need to sue. It is when they have been told to do the job with inadequate resources that a suit gets consideration.

In other words, schools should not sue when resources are not given to them because they need all those resources to teach, but they should not sue when they have plenty of resources because they don’t have a case. This is a catch 22 that would make Joseph Heller proud!

The decision to request the case be re-opened was made by the members of Schools for Fair Funding – individual member school districts. Schools for Fair Funding includes 74 school districts representing 168,018 children. State-wide organizations including KNEA, KASB, and USA were not plaintiffs in the original lawsuit and are not members of SFF now. Nor have they been asked to become members.

Session underway; mostly information gathering for now

The 2010 Legislative Session is officially underway but these first couple of weeks are the traditional information gathering weeks. Committees will be getting briefings from state agencies, the budget division, and interim committees and task forces.

The education committees are hearing from interim Commission Diane DeBacker and Deputy Commissioner Dale Dennis as well as Rochelle Chronister, Chair of the 2010 Commission. In addition they will take up the report of the Legislative Education Policy Committee which meets in the summer and fall interim period.

Groups come together to defend Kansas communities!

Kansans for Quality Communities press conference draws a crowd

In an unprecedented show of strength, a wide variety of organizations have banded together under the umbrella of Kansans for Quality Communities to say “enough is enough” to budget cuts.

The groups include educators, state employees, nursing home care providers, community mental health centers, and advocates for Kansans with disabilities. At a press conference this morning, the groups announced their formation and vowed to “stand up and speak out” whenever “the quality of life in Kansas communities is threatened.”

KNEA Director of Legislative Advocacy Mark Desetti served as spokesperson for this first public event but the meat of the press conference was in remarks by Mike Hammond, Executive Director of the Association of Community Mental Health Centers of Kansas, Shannon Jones, Executive Director of the Statewide Independent Living Council of Kansas, Cindy Rush, a Certified Nursing Assistant at a Topeka nursing home representing the Kansas Health Care Association, and KNEA Vice President Karen Godfrey speaking for KNEA, KASB, USA, and Kansas Families for Education.

The four speakers laid out the devastation of the budget cuts of 2009 and called upon legislators to “examine their consciences and consider the consequences of business as usual on Kansas communities and the quality of life we Kansans have come to enjoy.”

The groups vowed to “link arms” in the upcoming session in defense of the programs and services that make Kansas a great place to live, work, and raise a family.

Kansas NEA is proud to stand shoulder to shoulder with our partners in Kansas for Quality Communities. Together we will carry a message supporting strong, vibrant communities in every corner of this great state.

As stated in today’s press conference, “We represent the spirit of a Kansas that pulls together for one another.  We stand for safe, healthy and vibrant communities, with strong economies and sound infrastructures and for social assistance for citizens who need a little help for a chance to succeed.”

The organizations in Kansans for Quality Communities are:

• The Association of Community Mental Health Centers of Kansas
• The Disability Rights Center of Kansas
• InterHab Resource Network for Kansans with Disabilities
• Kansas Area Agencies on Aging Association
• Kansas Association of Public Employees
• Kansas Association of School Boards
• Kansas Families for Education
• Kansas Health Care Association
• Kansas National Education Association
• Kansas Organization of State Employees
• Statewide Independent Living Council of Kansas
• United School Administrators/Kansas

Merry Christmas, Moderates. Now, go away!

House Speaker Mike O’Neal (R-Hutchinson) continues his war on moderate Republicans just in time for the Christmas holiday.

Last spring, O’Neal dealt with moderate Republican members of the Appropriations Committee Barbara Craft (Junction City) and Bill Light (Rolla) who opposed his efforts to gut education funding by stripping them of their seats on the committee and replacing them with his ideological soulmates. Craft and Light had often sided with the Democrats in trying to minimize cuts to K-12 and higher education.

Just yesterday, in his continuing quest to minimize funding for public schools, O’Neal removed the two moderate Republicans from the House Education Budget Committee. Those seats had been held by Barbara Craft (Junction City) and Terrie Huntington (Mission Hills) who will be replaced by Brenda Landwehr (Wichita) and Arlen Siegfreid (Olathe). Huntington and Craft had joined Democrats on the Committee to adopt education funding recommendations with cuts that were not nearly as deep as those demanded by O’Neal and Appropriations Chairman Kevin Yoder (R-Overland Park). Yoder then had to manipulate the committee actions to bring O’Neal’s budgets to the floor of the House.

In addition, O’Neal appointed Ray Merrick (R-Stilwell) to replace Jason Watkins as vice chair of the Appropriations Committee. As House Majority Leader, Merrick is O’Neal’s right hand man. Watkins, who resigned his House seat, will return to Topeka as a lobbyist for the Wichita Chamber of Commerce.

These actions by O’Neal mean that among the Republicans on both the House Appropriations Committee and the House Education Budget Committee, there is only one moderate Republican, Don Hineman (R-Dighton). O’Neal is guaranteed a budget committee that will recommend deep cuts to education and Yoder is guaranteed a committee with no Republican dissent. Debate is essentially shut down in favor of ideological fervor.

While Craft has been reassigned to the House Government Efficiency and Fiscal Oversight Committee, Terrie Huntington has been selected to replace David Wysong in the Kansas Senate. Huntington, who has shown herself to be a strong supporter of public education will be an excellent replacement for Wysong who was a strong voice for schools in the Senate.

Committees meeting this week

Pensions and Benefits

The Joint Committee on Pensions, Investments, and Benefits met on Monday in their on-going consideration of how to address the long-term problems with the Kansas Public Employee Retirement System.

At their last meeting, they had requested that KPERS Executive Director Glenn Deck come back with models of changes that might be implemented to bring the system back into actuarial balance. Deck had brought them a number of ideas earlier that had been requested by the House Appropriations Committee.

While the House Committee is dominated by legislators who want to dismantle the defined benefit pension plan for public employees, the members of the Joint Committee are much more reasonable. After Deck demonstrated that the state would save no money in changing to a defined contribution plan (commonly known as a 401-k) the Joint Committee requested that options for shoring up the current defined benefit plan be brought to them including a model that used more pension obligation bonds to quickly infuse the system with money.

The proposals heard this week include ones that increase the employer contribution as well as the employee contribution. To meet the legal challenge of increasing the employee contribution, one of the plans would increase the retirement benefit multiplier for all years of service under the increased contribution rate.

The Joint Committee is taking a reasoned, rational approach to addressing the problem. Unfortunately the House Appropriations Committee just wants to dismantle the system. This is an issue that will need lots of watching throughout the legislative session which begins on January 11.

Ways and Means

The Senate’s money committee – Ways and Means – met on Wednesday just to take a look at the current budget status and get a step up on addressing problems as quickly as possible once the session begins on January 11.

Much of the time was given to Secretary of Administration and Budget Director Duane Goossen who reviewed the cuts passed by the 2009 legislature and the July and November allotments enacted by the Governor. Goossen told the committee that the budget shortfall for 2010 (the current fiscal year) is approximately $260 million. That figure includes the revenue decline of some $235 million and a needed increase of over $23 million to fund the human services caseload.

The Governor’s allotments meet the shortfall but several of them require legislative action. Those include two transfers from the state highway plan, one from the Securities Commissioner, and two from the Economic Development Incentive Fund (EDIF). Also needing legislative action is permission to lapse the legislature’s own prior year shifts – normally if the legislature does not expend all of its appropriated money, the savings stays with the legislature for use on the same activities the next year. Lapsing that shift would save $2.2 million in the budget.

Senators John Vratil (R-Leawood) and Janis Lee (D-Kensington) made the motion to introduce legislation to enact all of the Governor’s recommendations. The motion passed unanimously.

A big discussion on the school side was whether or not Kansas school funding had actually been cut to the 2006 level. If Kansas were to cut below the 2006 level, we would lose our federal economic stimulus money.

Goossen reported that general state aid for Kansas schools has been cut to the 2006 level. After much questioning, it was revealed that overall aid to schools is above the 2006 level leading some to wonder whether or not more could be cut.

In applying for the stimulus money (ARRA), the state was given the ability to define what constituted state funding. In the application to the federal government, Kansas defined state funding as general state aid. This left out of the equation supplemental state aid (LOB aid), special education, and any KPERS school contributions. If those are included as state aid then, Goossen asserted, we would be above the 2006 level.

Senator Ty Masterson (R-Andover) asked if the state could consider the ARRA funds as state aid. He apparently thought that cutting more could be done if we said the combination of ARRA funds and general state aid is above the 2006 level. He was told that federal aid could not count as state aid. Vratil also noted that using ARRA funds to replace state funds would automatically put a state’s application for Race To The Top (RTTT) funds at the bottom of the pile.

Among the most troubling of all the budget cut statements came in response to a question from Senator Lee on the Governor’s cut of 10% to the Medicaid provider rate. Asking about the consequences for Kansans of this particular cut, Goossen responded that some nursing homes and doctors would “limit their exposure to Medicaid patients.”

It is clear that these serious cuts to schools, higher education, and social services are putting opportunities and even lives at risk right here in Kansas.

New allotments slash school funding to 2006 level

Forced once again to balance the budget in light of declining tax revenues, Governor Mark Parkinson announced a series of allotments to state agencies and programs. Among those reductions was a cut of $36 million in addition to a recommendation not to fund the $155.8 million K-12 increase based on revised estimates of property tax revenue and student enrollment.

This action takes base state aid per pupil (BSAPP) for the current school year down to $4,012 – a full $421 cut per pupil from the originally approved $4,433. It is believed that this is as deep as K-12 cuts can go without jeopardizing federal Recovery Act (ARRA) funds.

The Governor also cut $85.9 million in supplemental general state aid from K-12 but replaced that money with federal ARRA funds. These funds were taken from the 2011 ARRA funding. While this is an action to balance this year’s budget, it reduces the ARRA funds available in the event of continuing problems with next year’s budget.

These allotments on top of previously enacted cuts will create serious challenges for many school districts. While some will be able to turn to contingency reserve funds, many school districts have inadequate or no such funds and will be forced to make damaging cuts to student programs.

Read the Governor’s budget allotment press release here: http://governor.ks.gov/media-room/45-press-releases/470-11232009-parkinson-cuts-spending-balances-budget

Schools for Deaf, Blind and Regents also cut

The State Schools for the Deaf and Blind will see their operating expenditures cut by $271,930 and $168,481 respectively while the Regents will get an additional $2 million cut. The Regents system has been tied to K-12 by the ARRA regulations so their funding has also been reduced to the 2006 level.

Walt Chappell, Bob Corkins attack public education

State Board of Education member Walt Chappell appeared before the Appropriations Committee to call for a massive consolidation of school districts which he claims would save the state $300 million. Chappell suggested that teachers don’t work enough and ought to be in their buildings with students eight hours every day. Beyond that, Chappell wants parents to pay the cost of varsity sports and opposes the use of free-lunch counts for at-risk funding. Chappell made it clear that he was speaking for himself and not the State Board of Education. State Representative Owen Donohoe (R-Shawnee), agreeing with Chappell on the non-working teacher point, asserted that one can hear a pin drop in school buildings by 3:15 because they are vacant.

Bob Corkins – one-time Commissioner of Education and darling of the conservatives for his anti-public schools zealotry – also appeared before the Committee. Corkins is demanding that schools report spending on a building by building basis to prove they are using money efficiently and spending it equally for each student. Conservatives continue to demand studies of school district efficiency because every one so far has shown that school districts are using their funds efficiently. (If you don’t get the answer you want in a study, call for another one.)

Corkins also told the committee that there is no rationale for using weightings to increase funds for children with additional needs – bilingual, at-risk, etc. Corkins likely wants the state to eliminate weightings making every child funded at exactly the same level because it feeds his call for de-funding public education through a voucher program. As Commissioner, Corkins was known for his desires to push the State Board of Education into calling for vouchers and unaccountable charter schools. Corkins’ reign was short once voters ousted the conservative SBOE members who hired him. You might recall that he quit shortly after the election.

Hays Superintendent Fred Kaufman tells it like it is

Fred Kaufman, the superintendent of Hays Public Schools and a frequent representative of Schools for Fair Funding, laid out the consequences of continued funding cuts for schools in testimony before the Appropriations Committee. Kaufman suggested that continuing cuts will cause districts to consider ending all-day Kindergarten, closing schools, and even eliminating employee health benefits.

Kaufman was taken to task by Representative Peggy Mast (R-Emporia) because he had not “led by example” and taken a pay cut. Representative Bill Feuerborn (D-Garnett) suggested Mast could do the same by simply signing a form saying she did not wish to be paid for attending these interim committee hearings. No word yet if she did.

Revenue takes another tumble

Governor says he will balance the budget

The consensus revenue estimating group announced yet another drop in expected revenue yesterday triggering more speculation about what the Governor might or might not do to balance the budget for fiscal year 2010.

Governor Parkinson continues to indicate that he intends to take whatever action is necessary to put the budget into balance before the Legislature returns in January.

State Budget Director Duane Goossen and Legislative Research Director Alan Conroy have different takes on the size of the money gap that must be bridged through cuts. Goossen says the gap is $258.8 million while Conroy calls it $459 million. The difference is apparently looking at what is and is not a “legal obligation.”

Conroy’s numbers include additional spending to cover social welfare caseload increases and more than $150 million needed to fully fund the school finance formula. That school money is the result of new calculations on enrollment and student need such as at-risk, bilingual, and special education. There is some debate about whether or not the additional caseload and school money is a “legal obligation.”

Last year, as part of the 2009 budget cuts, the Legislature just did not make the supplemental appropriation necessary to fully fund the school finance formula. There is a strong possibility that this will be a big step in balancing the 2010 budget now.

There was some good news in the report. The Kansas economy appears to be improving and tax revenues are expected to be up in fiscal year 2011. Still, however, there will be a budget gap due to obligations the state has to pay for some other projects and to repay some loans. That gap though is expected to be less than this year’s gap.

Tax increase speculation

Earlier this week, Governor Parkinson indicated that a tax increase might be part of the budget deliberations in the upcoming session. Although he has backed off that statement somewhat, there is talk that budget cuts have already gone too far and a tax increase may be necessary.

Even the Lawrence Journal-World, noted for its conservative principles, editorialized that a tax increase should be part of the discussions (http://www2.ljworld.com/news/2009/nov/05/state-subsistence/).

In truth, a “tax increase” can take the form of simply rethinking some of the billions of dollars in corporate tax cuts passed over the past decade. While the unprecedented financial collapse of 2008 played a large role in our current budget struggles, one cannot ignore the alacrity with which Kansas legislators slash corporate taxes every chance they get.

These tax cuts have also shifted the tax burden to local property taxes as local units of government struggle to continue providing police and fire protection, road maintenance, and public schools.

A tax increase is not the only thing the Legislature could do. We believe that a rational policy at this time would be to take a series of steps to stabilize the revenue system.

• First, agree to stop considering additional tax cuts. As they say, “If you’re in a hole, you should stop digging.”
• Secondly, the Legislature could halt the phase-in of already granted tax cuts. Two considered and rejected last year were the phase-out of the estate tax and the phase-out of the corporate franchise tax.
• Then, when Congress grants a federal corporate tax cut, the state should decouple that provision of our state tax code from the federal tax code. Kansas, like many states, has tied its tax code to the federal tax code meaning whenever Congress changes a tax provision, it automatically changes the state tax provision. State tax policy should be in the hands of state legislators, not Congress.
• Finally, a tax increase should be on the table for discussion.

In the end, however, it will take more than these simple steps to repair the system.

The Kansas sales tax system lists exemptions and exclusions in statute. That list goes from (a) to (ffff) with some of those subdivided into as many as 24 additional exemptions. Many of them are hard to argue with – Goodwill Industries and Easter Seals, for example. Others are questionable and need examination – Ottawa Suzuki Strings or Johnson County Young Matrons. Every one of these exemptions and exclusions needs to be re-examined. And it would probably be best if they were all repealed and replaced with an evenly applied statutory set of criteria. If you meet the criteria, you get the exemption.

There is a growing call in the capitol to stop the willy-nilly tax madness and form a blue ribbon tax modernization commission made up of business and non-profit representatives, economists, and legislators charged with evaluating the state’s revenue system and making recommendations for improvement. Kansans deserve a tax system that will provide for quality state services, encourage economic development, and have fairness to both business and individuals as a hallmark.

Sadly, as organizations like Americans for Prosperity continue to call for the elimination of government services and taxes, too many legislators find their appeal too much to resist.

KPERS discussions continue to cause alarm

There has been no let-up in the attacks on KPERS. Those legislators speaking out at meetings of the House Appropriations Committee continue to push for an abandonment of responsibility and the dismantling of the KPERS defined benefit retirement system.

After years of legislative neglect, KPERS finds itself faced with an unfunded actuarial liability (UAL) that, if not addressed responsibly, could eventually spell trouble.

As it is now, the UAL is manageable. It will take some additional state investment to make up for the many times the Legislature did not put the state share into the system either because they were depending on huge market gains or because they were using those funds to balance the budget. But instead of taking the responsible approach, these vocal anti-government, anti-union legislators want to punish the employees who have met their obligations year after year.

So far their calls have been based on a demand from the Koch Industries funded Center for Applied Economics that the system be scrapped in favor of a defined contribution plan or 401(k). Such a move would allow  the state to put only a minimum amount of money in and leave retirees to fend for themselves should there be a market decline during their lifetime.

A change that would put new employees in a defined contribution plan would have no impact on the UAL – in fact it would get worse unless the state continued to fund the current system as if these new employees were still in.

In addition, more evidence keeps coming in pointing to the failure of the 401(k) to provide for a secure retirement. In the article “Why It’s Time to Retire the 401(k)” published on Oct. 9 in Time, it was noted that “The average 401(k) has a balance of $45,519. That's not retirement. That's two years of college. Even worse, 46% of all 401(k) accounts have less than $10,000.”

The article goes on to quote other experts: "’The time may have come to consider returning 401(k) plans to their original position as a third tier of retirement planning, behind pensions and Social Security,’ says Alicia Munnell, who heads the Center for Retirement Research at Boston College. ‘They should not be the thing we rely on for retirement security.’ And the government seems to agree. This summer, the Government Accountability Office concluded, ‘If no action is taken, a considerable number of Americans face the prospect of a reduced standard of living in retirement.’"

Read the full article for yourself at http://www.time.com/time/business/article/0,8599,1929119,00.html

On October 19, USA Today said essentially the same thing in their article “Retirement overhaul: 401(k)s may not be the answer now.

Among their findings: “Nearly 24% of Americans older than 65 have incomes below the poverty threshold, according to the Organisation for Economic Co-operation and Development. And the United States, Ireland, South Korea and Mexico have the highest old-age poverty rates among the 30 OECD countries.”

The USA Today article goes on to report some alarming findings about the notion that people do better controlling their own investments. “Statistics also show that 401(k) plans don't serve everyone well, and that those who use them often make big investing mistakes, including cashing them out early.”

And there is a particular problem for women in the 401(k) world. “Women also face an obstacle men do not. They need to replace more of their final pay for retirement — 2% more than the average male — because they live longer, Hewitt (Associates) says. Women, however, typically save less than men and invest less aggressively.”

According to the article, one of the biggest problems facing those who rely on the 401(k) is that in tough economic times employers will cut or eliminate their contribution to the plan and often pass on management costs to the employees.

Read the full article for yourself at: http://www.usatoday.com/money/perfi/retirement/2009-10-19-401k-savings-retirement_N.htm

Despite mounting evidence that 401(k) defined contribution plans will not provide retirement security, Art Hall, former Koch executive and Director of the Center for Applied Economics, and legislators like Kasha Kelley (R-Arkansas City) and Peggy Mast (R-Emporia) continue to call for changing KPERS to just such a system. Mast has suggested that, had the legislature taken this action long ago, retirees could have taken advantage of the market growth. Unfortunately, this ignores the market experience of 2008.

While no legislation has been introduced on KPERS, we would anticipate that a bill to change the system from defined benefit to defined contribution will be coming.

For easy to understand explorations of these retirement issues, go to the KNEA “At the Capitol” website at http://www.knea.org/legislative/index.htmlx and review the articles in our Current Issues box.

Two days and two committees

KPERS and Consolidation

On Monday October 12, both the Legislative Education Planning Committee (LEPC) and the House Appropriations met. There were a number of issues up for discussion in both committees.

Tax receipts drop again

The House Appropriations Committee heard from State Research Director Alan Conroy who presented an update on State General Fund Receipts. The state’s tax receipts are down 5.3% from earlier estimates. While the numbers are down, the current trends put the state in a “wait and see” mode regarding budget revenues for the next quarter. The next revenue estimates are due out on November 5^th.

Should we consolidate our schools?

Later, Dr. Andy Tompkins, former Kansas Commissioner of Education and current Dean of the College of Education at Pittsburg State, was asked to discuss school consolidation with the committee. Tompkins reported that in the last 18 years there have been two studies initiated by the legislature regarding school consolidation. The first was completed in 1992 by the Legislative Post Audit and the second completed in 2001 by Augenblick and Myers.

One of most interesting findings of the 1992 LPA study was written in a report by Barb Hinton. In response to the question regarding whether any other states found cost savings from consolidation, her response was “……consolidation resulted in minor savings in administrative costs, but significant savings will occur only when schools are closed, class sizes increased and the number of teachers is reduced.”  (Emphasis added.) The states in the LPA study did not require districts to consolidate, but had encouraged consolidation through financial incentives or through expanded curriculum and staffing requirements.

Dr. Tompkins concluded his remarks by saying that the current policy has been effective in making progress on this issue and if the committee wants to change current policy, they should first visit with their constituents and colleagues to see if there is support or interest in changing the policy.

KPERS

Meanwhile, over in the LEPC meeting, KPERS Executive Director Glenn Deck presented a KPERS update. Deck started his report by reviewing the changes in the law regarding working after retirement. The latest data he had was from December 2008 and at that time there were 2,672 working after retirement. More comprehensive data about retirees rehired under the new provisions of HB 2072 will be available after KPERS receives employer reports at the end of the calendar year.

Deck next reported on the KPERS long term funding situation. He noted that after the unprecedented investment market declines in 2008 the system experienced a negative impact on the KPERS funded status. Before the downturn, the system had actually made gains in reducing its unfunded liability.

He also noted that current benefits are safe. Assets of approximately $10 billion are available to pay benefits. KPERS will conduct a comprehensive funding analysis with options to be presented to the Legislature and the Governor later this year for their consideration.

In the afternoon the House Appropriations Committee broke into subcommittees to hear the budget requests that the different agencies would be making to the Governor. Assistant Commissioner Dale Dennis presented the KSDE budget requests and gave the subcommittee the State Board of Education’s request to fund education at the levels reflected in current law. This would mean the restoration of cuts made in the 2009 session and the Governor’s later budget allotments.

This morning KPERS was the first topic of discussion in the Appropriations Committee. The Committee invited Art Hall – the director of the Koch-funded Center for Applied Economics and defender of the Barry Poulson “study” on KPERS. Hall and Poulson called KPERS “bankrupt” and Hall was forced by several legislators to backtrack on that statement. He assured the committee that KPERS was in no danger of not meeting its obligations.

But Hall went on to call for the destruction of KPERS as a defined benefit pension system and replacing it with a 401(k) style defined contribution system. He has apparently convinced a few anti-government legislators that this would be a good idea despite the fact that it would only make the unfunded actuarial liability worse by removing future investments from the defined benefit system unless pension benefits were dramatically reduced.

In addition, more evidence keeps coming in pointing to the failure of the 401(k) to provide for a secure retirement. In an article published on Oct. 9 in Time, it was noted that “The average 401(k) has a balance of $45,519. That's not retirement. That's two years of college. Even worse, 46% of all 401(k) accounts have less than $10,000.”

The article goes on to quote other experts: "’The time may have come to consider returning 401(k) plans to their original position as a third tier of retirement planning, behind pensions and Social Security,’ says Alicia Munnell, who heads the Center for Retirement Research at Boston College. ‘They should not be the thing we rely on for retirement security.’ And the government seems to agree. This summer, the Government Accountability Office concluded, ‘If no action is taken, a considerable number of Americans face the prospect of a reduced standard of living in retirement.’"

Read the full article for yourself at http://www.time.com/time/business/article/0,8599,1929119,00.html

Despite mounting evidence that 401(k) defined contribution plans will not provide retirement security, Hall and legislators like Kevin Yoder (R-Shawnee) and Peggy Mast (R-Augusta) continue to call for changing KPERS to just such a system. Mast, in today’s meeting, suggested that, had the legislature taken this action long ago, retirees could have taken advantage of the market growth. Unfortunately, this ignores the market experience of 2008.

While no legislation has been introduced on KPERS, we would anticipate that a bill to change the system from defined benefit to defined contribution will be coming. Work in the state is following a pattern established elsewhere and most recently in Colorado. Barry Poulson authors a “study” attacking the solvency of the defined benefit program which is followed by a radio blitz to convince the public that the system must be dismantled. The radio spots have already begun here in Kansas.

You may want to call your legislator and ask what position he/she holds on changes to KPERS.

Appropriations Committee meets to hear about impact of cuts

The House Appropriations Committee met on Monday and Tuesday ostensibly to hear about the impact of budget cuts on state agencies and to take a few swings at their favorite whipping boys.

Notably absent from the committee were Republican Representatives Bill Light (Rolla) and Barbara Craft (Junction City) who were both removed from the committee by Republican leadership. Light and Craft apparently sided too often with Democrats in defending state agencies including education. Light and Craft were also the only two Republican members of the committee who voted to adopt the Senate budget that provided for smaller cuts to education in the 2009 session.

Monday the committee heard from most state agencies while Tuesday was devoted to K-12 education, the Department of Labor, the Department of Health and Environment, and KPERS.

K-12 education was very well represented by five superintendents – John Allison (Wichita USD 259), Kevin Singer (Topeka USD 501), Gene Johnson (Shawnee Mission USD 512), Don Wells (Scott City USD 466), and Marvin Estes (Winfield USD 465). All five superintendents focused on several important points:

• Districts, to the greatest extent possible, focused cuts on support services more than classroom teaching causing concern for the district’s ability to effectively reach more challenging student populations.
• School funding in total dollars expended across the state is almost equal to the prior year but only because the federal stimulus money offsets the state reductions causing great concern about the challenges schools will face when the stimulus money goes away in 2012.
• Large increases in certain fixed costs – particularly insurance, utilities, and fuel – make the “flat funding” argument moot. Districts are unable to continue to provide adequate student support services and pay for health insurance premium increases and utility increases.
• Salaries were kept frozen or, where minimal raises were given, it was due to reductions in staffing overall. Wells for example noted that Scott City teachers received a raise of a little over $400 but that salary costs overall were reduced due to the elimination of several teaching positions.

Questions from legislators focused on alleged inefficiencies. The myth of inefficiencies is fast becoming the hook on which they may try to hang their deeper cuts. Much of the questioning had to do with whether or not the state should adopt a common accounting system so they can compare districts and root out inefficiencies. All of this inefficiencies discussion continues to take place despite the fact that studies conducted by Standard and Poor’s and the Legislative Post Audit have not found school districts to be inefficient. On occasion, legislators will ignore studies that don’t conform to pre-conceived ideas.

At one point, Representative Jeff Whitham (R-Garden City ) noted that in the past five years school funding has grown by 9%, 9%, 5.5%, and 3.5% before declining by 0.2% this year. He wondered why school districts needed to cut anything. The superintendents responded with evidence of dramatically rising fixed costs, additional unfunded mandates, and the demands through the accreditation system and No Child Left Behind that academic achievement improve every year. It was later pointed out by Representative Tom Sawyer (D-Wichita) that in reality state funding for K-12 education declined by 9% this year but most of the cut was offset by stimulus funding – funding that will soon disappear. In addition, the superintendents pointed out that many districts raised additional local funds through property tax increases and/or increased fees on students. Yet even with all the additional stimulus funds and local effort, schools were unable to make up completely for the reduction in state aid.

KPERS under attack?

What to do about KPERS continues to generate debate. The report this year is that economic conditions have made the unfunded actuarial liability (UAL) worse. This is not a surprise given the downturns in the markets experienced over the last year.

Let’s not lose sight of why the problem is so big to begin with. For years, the Kansas legislature has failed to fully fund the employer obligation to KPERS. Of course, the only legislator who routinely pointed that out – John Edmonds of Great Bend – is no longer in the legislature.

KPERS Executive Director Glenn Deck noted that KPERS has sought legislation to increase the rate at which the state contribution can increase. Currently the state contribution increase is capped a 0.6% annually and KPERS wanted the cap set at 1%. Had this legislation passed, it would have had a very positive impact on reducing the UAL.

Almost immediately, the attacks on defined benefit plans started. Legislators David Crum (R-Augusta), Kasha Kelley (R-Arkansas City ), and Kevin Yoder (R-Overland Park ) all expressed support for moving from the current defined benefit plan to a defined contribution plan. Such a change would be good for the state because they could contribute far less money. Such a plan would be bad for state and school employees because it would dramatically reduce the retirement benefit.

KPERS, as a defined benefit plan, invests contributions and uses a formula to guarantee a retirement benefit as long as the retiree lives. Under a defined contribution plan, any retirement benefit is tied to the performance of the market – there is no guaranteed benefit. If the market goes up dramatically, you get a benefit. If it goes down, you risk losing the benefit. For a more detailed explanation of defined benefit versus defined contribution plans, click here.  

Some legislators are not concerned about the quality of life for retirees but focus only on the immediate cost to the state. Rep. Kelley suggested that since the private sector uses defined contribution if they even have a retirement system, public employees should not expect to have a better system. Deck pointed out that the private sector has not completely abandoned the defined benefit plan and that between 40 and 50% of large corporations still provide defined benefit plans because those plans are better for their employees. Deck also pointed out that many employers underfund their defined contribution plans which only exacerbates that problems faced by retirees when the markets go south.

Hutchinson School District joins lawsuit group

The Hutchinson News reported on Tuesday that the Hutchinson School Board voted to join Schools for Fair Funding, the group of districts that successfully sued the State of Kansas over school finance. The lawsuit, known as Montoy, forced the legislature in 2005 to dramatically increase school funding.

According to the Hutchinson News:

At its Monday meeting, the USD 308 Board of Education voted 5-2 to join a group of school districts considering bringing litigation against the state for what they call an erosion of the progress made through the historic Montoy v. State of Kansas school finance case filed in 1999.

The resolution the board adopted stated that the board "expresses its further conviction that the Kansas legislature has failed to fulfill its constitutional mandate to make suitable provision for finance of the state's educational interests."

Of note in this is that Hutchinson is the hometown of House Speaker Mike O’Neal who supported significantly larger cuts to education funding than those ultimately adopted by the 2009 legislature.

Read the whole story by clicking here.

Certificates Approved

With no opposition, the State Finance Council this morning approved Governor Parkinson’s request for $700 million in certificates of indebtedness, enabling the state to meet its budget obligations as we enter a new fiscal year.

July is a difficult month for the state since it is the start of the fiscal year and has some significant required spending. One large area of spending is made up of school finance payments. And because July is usually not a big month for revenue collections, it is common practice for the state to issue certificates of indebtedness. Last year, the state issued $775 million in certificates.

Governor Parkinson and Budget Director Duane Goossen believe that, barring another significant downturn, the action taken today in concert with the Governor’s allotments last week will allow the state to meet its obligations for FY 2010.

Many economists believe that this recession has finally bottomed out and that we are now beginning what will be a long and slow recovery. While not expecting a quick turn-around, many believe the worst is over. If that is true, there may not be the need for further cuts to state programs.

House Republican Leadership tries blame game

While the Governor was working to resolve the latest budget problem, Republican leaders in the House were trying to blame Democrats for the problems.

House Speaker Mike O’Neal blamed Democrats for passing a budget without an ending balance causing more cuts to be made. Unfortunately for O’Neal, with the Democrat caucus falling far short of a majority (only 49 of 125 Representatives are Democrats) it’s tough to make such partisan accusations stick. In truth, the budget passed was a bipartisan plan crafted by 13 Republicans and eight Democrats in the Senate and adopted by a bipartisan coalition of Republicans and Democrats in the House.

Additionally, the plans proposed by the Republican House Leadership would not have enabled the state to get by without the allotments or the certificates of indebtedness.

The Wichita Eagle took House Republican Leadership to task for the blame game in an editorial this morning. To read their take on the situation, click here. http://www.kansas.com/opinion/editorials/story/879531.html

Governor makes cuts to state programs

Reacting to news that state tax collections have come in below expectations, Governor Mark Parkinson has issued a series of “allotments” – or cuts – to state services in order to bring the state budget into balance.

Kansas, like most states, requires a balanced budget and, when the legislature is not in session, the Governor is given the authority to restore balance through cuts. The Governor does not have the authority to order revenue enhancements.

When the legislature adopted a budget with a $17,000 ending balance, we knew that this day might come. We continue to believe that the legislature acted appropriately in enacting only enough cuts to balance the budget based on what was known at the time. The idea was to balance the budget and then watch for signs of an economic recovery that might get the state through the year.

But after two more months of bad economic news, the budget has again gone out of balance, forcing Governor Parkinson to make allotments.

When asked if more cuts might come later, the Governor responded, “We will make cuts when we have to and we will not make cuts until we have to.”

For the text of the Governor’s press release and a link to the details of all the allotments, click here.

It seems inappropriate to cut more than is necessary. We know that budgets, once cut, rarely get restored. We anticipate that, even as the economy recovers, some legislators may not be willing to restore education funding to the levels we have enjoyed in the past few years. And this is despite the fact that a legislatively-ordered study of the new education funding conducted by the Legislative Post Audit Division found a nearly one to one correspondence between increased spending and student achievement gains.

In the allotments announced at the news conference this morning, the Governor spared Kansas school children as much as he could. While schools will be getting a two per cent cut, that cut will not be applied across all portions of the K-12 budget. The cut will be applied to general state aid only. This means that there will be a cut of approximately $62 to base state aid per pupil but no cut to special education, LOB state aid, etc.

Click here for a district by district analysis of the impact of this cut.

Schools, already reeling from the loss of nearly 4,000 employees, will have a difficult time adjusting budgets to meet this additional reduction. There will likely be further reductions to student programs. Legislators need to know that student achievement will be harmed. While there is not likely to be an immediate downturn in student achievement levels, the longer it takes to restore education funding, the greater the impact will be.

In discussing the additional cuts to education, the Governor said, “There is really no way to spin this that it won’t create serious challenges for them (schools).” But he trusts that school boards, administrators, and teachers will find appropriate ways to address the cuts.

There is a solution to this problem but unfortunately too many legislators don’t care to talk about it.

For the past several years, policy makers have been on a tax cut spree. According to a memo from legislative staff, just calculating the tax cuts passed since 2005, the impact on the 2010 fiscal year is a loss of over $180 million to the state treasury. By FY 2013, that impact will be $1.135 billion. This is providing they pass no more tax cuts between now and 2013!

It is long past time for legislators to stop this tax cut madness and rethink the whole Kansas revenue system. It is possible to craft a system that is fair to both individuals and businesses, provides for economic development, funds quality state services, and is less susceptible to swings in the economy.

Once again, we call on the legislature to establish a tax modernization commission made up of economists, business leaders, representatives of non-profits and state agencies, and legislators to study the system and bring forward recommendations for change. Only then will the legislature deal effectively with the structural deficit in our system. Only then can Kansans begin to count on quality state and local government services.

Click here to read more about this issue!

May 12, 2009

If you recall, when we started this session, we told you how we longed to say, as Dickens once did, “It was the best of times; it was the worst of times” and know in our hearts that it would be the best of times?

Well, while things often looked remarkably bleak, we managed to come out just shy of “the worst of times.”

K-12 education has been cut – and cut deeply. But given that at one point in the session we were facing proposals to cut by as much as 18 per cent, the 2.75 per cent cut we ended up with was remarkable.

There will be three points to this wrap-up edition. First, we want to review legislation impacting education that was proposed and either failed or passed. Secondly, we want to focus on what actually happened on school finance and identify our biggest heroes and our greatest enemies. Finally, we will look to the future and the work that yet must be done – legislatively and politically.

We provide here brief introductions to each section and a hyperlink to more detailed information stored on the KNEA website. The links include summaries and hyperlinks to actual bills and conference committee reports.

Education legislation considered during the 2009 session

School finance was only one part of the legislative session. There were plenty of other issues discussed and lots of opportunities for your lobbyists to rise up in praise or indignation during committee meetings.

We went from vouchers to unfunded mandates; from dyslexia to disabilities awareness; from medical procedures to the minimum wage; and yes, even to KPERS.

School finance for 2009 and 2010

One of the first actions of the legislature was to cut the 2009 budget. The state must maintain a balanced budget and the combination of the structural deficit in the state’s revenue system and the extreme downturn in the economy caused the budget to unravel.

From the start of the session in January, it was obvious to any observer that this was going to be a bad ride. So for those of you who have struggled to follow this, we present our first ever comprehensive school finance session timeline. We have kindly inserted little faces representing days of elation or depression!

More than BSAPP!

Beyond the Battle of the Base, there were other issues on school finance. The legislature passed bills that impacted National Board Certification, professional development, mentoring, the LOB, consolidation, and even contingency reserve funds.

Heroes of the 2009 session

There were indeed real heroes this session. When you look at votes taken in the House of Representatives in the last few days of the session, you can see just how important those heroes were. With a majority being 63 votes, you’ve got to have heroes when you are winning by 64 or 65!

What’s next? (Legislatively speaking)

Today we are relieved but only because it could have been so much worse. If, for example, the legislature had decided that it was critical to obey the ending balance requirement, cuts everywhere would have been much, much deeper. If President Obama had not pushed through the American Recovery and Reinvestment Act, cuts would have been much, much deeper.

But if you are thinking we are out of the woods and the budget problem is over, think again. Kansas has a fundamental problem with the revenue system that all but ensures that, even when the economy has recovered, there will be times of shortfalls in the future.

Legislatively, it’s time to talk seriously about fixing the structural problems in the Kansas revenue system.

Sweating bullets over slim margins

One might have noticed that our victories are often won by the slimmest of margins. We get 64 votes or 65 votes. This leaves your lobbyists sweating over each and every critical vote. Remember that list of heroes? We need to have every hero every time!

How can we possibly make that happen?

Last day? YES! But it they sure took their time about it!

There were a few things left to do as the legislature convened on Friday morning. While the budget had been adopted due to the House action Thursday, the legislature started Friday still needing to resolve the tax/revenue bill, the coal plant/energy bill, a KPERS bill, and Senate Bill 84 – the LOB hold harmless bill.

Coal

The coal bill was the first thing up and went remarkably quickly. This was the coal compromise bill worked out between Governor Parkinson and Sunflower Electric CEO Earl Watkins and announced just last week.

The Senate made quick work of the bill Thursday night and it came to the House in the morning. There was only a little debate and the bill was ultimately adopted with only 18 NO votes. The bill had to be adopted without amendments in order to settle the issue and most legislators were apparently prepared to make the deal. The bill reduces the number of new coal plants to one and establishes a number of green offsets including wind and a requirement to burn 10% biofuels.

With this vote, one of the most contentious issues of the last two years was settled.

Tax

After the coal bill, the House went to work on the tax/revenue bill. This bill was needed to balance the budget passed Thursday. What is remarkable about this bill, which includes enhancing the ability of the Department of Revenue to settle outstanding tax challenges and a variety of alterations to certain tax credits, is that the Kansas Chamber of Commerce and Americans for Prosperity had made the decision not to oppose the bill.

With the Chamber’s okay, it was considered ready for concurrence but House Tax Chairman Richard Carlson (R-St. Mary’s) moved to non-concur with the Senate and send the bill to a conference committee. Carlson’s motion prevailed and so we were left waiting for a conference committee meeting announcement.

Interruptions

Hopes that the conference committee would meet quickly were dashed when the House resurrected the primary seat belt bill (making not wearing a seat belt a primary offense for which one can be pulled over) and got into two heated debates. The first was whether of not to go ahead and consider the bill again; the second the bill itself.

Those debates were also interrupted by fire alarms and an evacuation of the building. The Topeka Fire Department was summoned and, after checking things out and ensuring we were all safe, sent us back inside. Back inside where the House continued with their seat belt debate.

Tax again

Seat belt debates notwithstanding, a tax conference committee was announced for 1:30. Representing the House were Carlson, Jeff King (R-Independence) and Julie Menghini (D-Pittsburg). On the Senate side, it was Les Donovan (R-Wichita), Derek Schmidt (R-Independence), Julia Lynn (R-Olathe), and Tom Holland (D-Baldwin City ). The Senate has four members because Lynn and Schmidt are co-vice chairs.

Carlson expressed that the House had a couple of concerns. Primary among those were the statute of limitations on requesting certain sales tax refunds and their desire to have more money at the end of the fiscal year.

As the committee began to wrap up their first meeting, Carlson suggested that they could increase the cut to tax credits from 10% to 15% so as to provide a little ending balance. Of course, he then asked to consider putting in a couple of sales tax exemptions that had been vetoed earlier this year which would reduce the ending balance by about $3.7 million!

The second committee meeting was supposed to be at 3:30 but was unexpectedly cancelled.

Back on the floor

Both chambers went back to floor action after 4:00, taking up a variety of bills left hanging.

About 5:15, Rep. Julie Menghini (D-Pittsburg) rose on the House floor and made a new motion to concur in HB 2365, the tax bill that had been sent to conference earlier in the day.

There was no debate on the motion and the initial vote showed the motion passing with 63 votes. Legislators began explaining their votes in an effort to convince others to change. Speaker O’Neal (R-Hutchinson), Appropriations Vice-Chair Jason Watkins (R-Wichita), Brenda Landwehr (R-Wichita), Lana Gordon (R-Topeka), and Virgil Peck (R-Tyro) called the bill tax increases and bad for Kansans. Tax Committee Vice-Chairman Jeff King (R-Independence) urged the body to support the bill and noted for those who wanted a House bill, that the proposals in this bill were first proposed in the House and the Senate merely took them up and put them in a bill – the sincerest form of flattery.

In the end more representatives came to support the bill and by 5:40 it was declared passed on a vote of 65 – 56. This action put the whole budget debate to an end. Between the adoption of HB 2373 and now HB 2365 both the spending cuts and revenue enhancements that will bring the 2010 budget into balance were passed.

Waiting on the LOB

After the revenue package was adopted, our attention turned to the fate of Senate Bill 84 which is the so-called LOB hold harmless. Under this bill – in a conference committee report – schools will be able to collect their LOB as if base state aid per pupil was still at the statutory level of $4433.

Both chambers took a break until 7:00 pm and during that time rumors arose that there would be a move in the House to remove equalization aid from the bill. The intent would be to return the bill to conference and either get an agreement to take the equalization out and use the $14 million thus saved to pad the state’s ending balance or, short of that, just kill the bill.

The move would be very contentious as the LOB is a critical element of almost every school district’s budget.

As it turned out, SB 84 was being held up in negotiations over a few other issues of importance to some legislators. Once an agreement was made between the two chambers that they would run each other’s important bills, things began to move.

About 11:15 pm, Rep. Clay Aurand (R-Courtland) made the motion to adopt the conference committee report on SB 84. This “controversial” item was adopted with 112 Yes votes and only 6 No votes. It was all over by 11:25.

Having passed the House, the bill needed to be taken to the Senate for approval. After very little discussion, the report was adopted on a vote of 35 – 0.

KPERS

This left for us only one more conference committee report – the one on KPERS – HB 2072. The last time we reported on this bill, the only thing it did was to treat contracted retirees who return to work the same as those who are hired directly by school districts. There was no change in the earnings limit and no change in the KPERS surcharge.

This conference committee report had been adopted by the Senate back on April 3 but was then rejected by the House on May 6. A new conference committee was formed on May 7, met quickly and shot out a new report with some significant changes.

The changes are:

• Contracted employees are treated the same as those hired directly by school districts,
• The separation in service before returning is raised from 30 days to 60 days,
• For licensed public school employees, the earnings cap is lifted for a period of three years, allowing retirees to return to the same employer from which they retired,
• The KPERS surcharge is set at the employer actuarial rate plus eight per cent for a total surcharge of 20.07 per cent in 2010),
• Substitute teachers are not impacted by these changes, and
• Allow the purchase of KPERS participating service credit for work experience necessary to obtain certain technical or vocational teacher certifications.

The new increased surcharge will likely discourage some hiring of retirees but at the same time, the lifting of the earnings cap may encourage some districts to bring their own retirees back. Much of this bill was crafted to balance various legislative positions including those that want to discourage early retirement just to return to work, those that want their districts to be able to rehire their own retirees, and those that just want to get rid of the contractors. The vote would indicate that every legislator but one got what he or she wanted.

The Senate wasted no time, adopting the report on Thursday night on a vote of 37 – 1. The House adopted it on Friday on a vote of 116 - 0.

With the adoption of the KPERS conference committee report at 12:15 am, all the bills we were following were done.

The Legislature soon adjourned, effectively ending – but for the sine die ceremonial last day on June 4 – the 2009 legislative session.

We will have a session overview and analysis early next week.

House votes to concur in Senate budget bill!

64 Reps hold firm on protecting vital state services!

The big news today is the formation of a strong coalition of Democrats and moderate Republicans that came together on the House floor and voted to concur in the Senate amendments to House Bill 2373.

It started about 11:30 this morning when Rep. Kevin Yoder (R-Overland Park ) made a motion to non-concur in the Senate amendments to HB 2373. The Senate had taken this bill, gutted out its contents and replaced it with their omnibus budget plan. This Senate plan makes an addition 2.75 per cent cut to all state agencies including education and, if certain tax changes are adopted, will balance the state’s 2010 budget.

Yoder’s desire was to non-concur in the changes and form a conference committee where he hoped to hammer out an agreement making deeper cuts to all state agencies. The House omnibus budget has a 4.75 per cent cut to education, 0 per cent cut to public safety, and 5 per cent cuts to all other agencies. Immediately after Yoder’s motion, Rep. Clay Aurand (R-Courtland) made a substitute motion to concur. If Aurand’s motion passed, this would be the budget bill; if it failed, the bill would stay on the calendar and be available later for a motion to concur or non-concur if desired.

Debate started with moderate Republicans and Democrats arguing for concurrence and a few conservative Republicans arguing against. When the vote came it was initially 60 to 62 but Democrats asked for a call of the House. When this happens, the doors are locked and they must wait until all 125 members come in. This is usually done on close votes to give one side or the other the opportunity to lobby possible swing votes.

After a few vote switches, the tally shifted to 64 in favor, 60 against. At that point the call of the House was lifted, the vote was tallied, and motion declared passed.

Things, of course, are not necessarily over then. The House has 24 hours in which to offer a motion to reconsider their action. Sometimes such a vote is taken quickly because, if it fails, it is not possible to do anything about the bill again – it is passed.

We waited anxiously to see what would happen and then heard about 4:30 pm that passage of the bill was read in on the Senate floor. This is very good news. When the notice was sent to the Senate and read in, it was no longer in the possession of the House. They can’t do a motion to reconsider unless the Senate sends it back.

All good news – with this action, the cuts to state services for 2010 will have been minimized.

“Do not forget to send your thank you note!”

(Remember? Mom said this all the time!)

With this good news comes the need to send messages of appreciation to the legislators who stood firm for minimal cuts.

Please take the time to thank the following Republican legislators:

Rob Brookens

Pat Colloton

Barbara Craft

Don Hill

Terrie Huntington

Dan Johnson

Bill Light

Tom Moxley

Jo Ann Pottorff

Richard Proehl

Jill Quigley

Charlie Roth

Tom Sloan

Sheryl Spalding

Kay Wolf

Ron Worley

In addition, every Democrat voted YES – all of them deserve your thanks as well.

Message Points (that can and should be put in your own words):

• Thank you, thank you, thank you.
• Your vote to concur on HB 2373 showed real courage and demonstrated your commitment to protecting Kansas schools and colleges and services for Kansans with disabilities.
• Please know that I am deeply grateful for your vote today and that I do appreciate that it took real strength of character to stand up for Kansans at this time.
• If there is a motion to reconsider this vote, I urge you to stand your ground, stick up for your convictions and vote NO on reconsideration.
• Thank you for your strong support for Kansas and Kansans.

Legislative emails are easy! Just use Firstname.lastname@house.ks.gov

Today’s action moves the legislature much closer to adjournment. We are waiting tonight on action on an important tax bill and will then be watching for a few stray conference committee reports including SB 84 which contains the LOB “hold harmless” language.

No action on House floor today;

Critical vote could come tomorrow!

Both chambers returned at 4:00 to find themselves just about ready to adjourn for the day.

In the Senate, where they are waiting for House action or action from their Taxation Committee, there was just not much to bring up for discussion or debate. They adjourned quickly and vacated the capitol.

In the House, there were thoughts of things that might be done but none of them materialized. The House seems to be bogged down in a sort of chicken or egg scenario. This one has to do with what comes first – the budget or the tax?

There are two budget bills available for the House. One is Senate Sub for HB 2373, the Senate passed omnibus budget bill that cuts all agencies by 2.75 per cent; the other is House Sub for SB 205 adopted by the House Appropriations Committee that cuts education by 4.75 per cent, public safety by 0 per cent, and all other agencies by 5 per cent.

It is critical now that you contact your Representative – especially Republicans. Let them know that cuts of 4.75 per cent will cause serious damage to student learning, cause districts to raise student fees and limit student programs, jeopardize all non-tested programs including foreign languages, art, and music. The state simply must not turn its back on this whole generation of Kansas children and abandon completely the progress made since the settlement of the school finance lawsuit.

VOTE NO on any motion to adopt or advance House Sub for SB 205.

VOTE YES on any vote to accept Senate Sub for HB 2373.

Click here to contact your Representative.

No action in House Tax

Despite having good options to save the state $76.5 million, the Chairman of the House Tax Committee chose to adjourn his committee for the day without taking any action.

Some tax solution will need to be passed to balance the budget and this delay puts pressure on fiscally responsible legislators to pass deeper cuts than are necessary out of fear that the Tax Committee will do nothing.

This inaction is likely designed to frighten moderate Republicans into supporting the extreme cuts preferred by Speaker Mike O’Neal (R-Hutchinson), Rep. Kevin Yoder (R-Overland Park ), and Jason Watkins (R-Wichita). These three and their conservative colleagues have been demanding cuts that will turn back the clock on Kansas students by at least three years.

We look for them to continue to bottle up revenue solutions in the Tax Committee in their quest to slash funding for state services.

May 6, 2009; Earlier today

Both chambers in recess; House Tax Committee meets

Both chambers checked in at 10:00 am and, after taking care of some quick business, recessed until 4:00 this afternoon.

In the meantime, the House Taxation Committee held one meeting to begin discussions of some revenue matters.

On the agenda was a tax amnesty proposal that would allow the Department of Revenue to settle open cases on delinquent taxes. If passed it would save the state about $35 million. Revenue Secretary Joan Wagnon was on hand to answer questions. One legislator asked Chairman Carlson if the committee would be working the bill and got a vague answer akin to “We’ll see.”

The second part of the agenda was to begin reviewing the tax credit proposals that Rep. Jeff King (R-Independence) brought forth yesterday. King’s proposals would suspend the tax credits on community service and film production for two years and trim most other tax credits by 10 per cent. Exempt from the trimming (called the “haircut”) would be the earned income tax credit, the child care credit, the homestead credit, and the food sales tax credit. King would also have credits carry forward rather than be refunds.

King also proposed two changes in statutes of limitations on seeking tax refunds or credits. One would clarify the statute of limitations on income tax refunds and reduce from three years to one year the statute of limitations on sales and use tax refunds.

The King proposals in total would save the state $41.5 million. When combined with the amnesty proposal, the state could save $76.5 million – enough to solve the budget problem and keep cuts at a minimum as in the Senate plan.

The committee adjourned without taking any action and does not yet have another meeting scheduled.

Day two and still no outrage!

We find it fascinating that the morning after we use this space to reflect on the special circle of Dante’s hell reserved for the hypocrites, the Lawrence Journal World would break a story on the high salaries and large “payroll adjustments” that Republican House leadership has been handing over to their staff while at the same time trying to press through the legislature pay cuts to correctional officers, statehouse custodians, and other state employees just to continue accelerated tax cuts to corporations. (You can read the LJW article for yourself by clicking here.)

One such “payroll adjustment” was a check for $20,000 given to Speaker Mike O’Neal’s chief of staff during his first week on the job! This adjustment was for a gentleman who is being paid $90,000. It is worth noting that in 2008, Mark Parkinson – then the full-time Lieutenant Governor – was paid $30,549 while Governor Sebelius was paid $108,007. O’Neal’s chief of staff, then, when you put the salary and bonus together is making more than the Governor and more than three times the Lieutenant Governor. All for serving as chief of staff for a part time legislator.

Now, mind you, we have nothing against good salaries. We certainly wish that Republican House leadership felt as strongly about Kansas teachers as they do about their own staff. But we find their demands for fiscal restraint in our schools and other state agencies to be a tad, dare we say, “hypocritical.” The fiscal restraint they are showing schools this year has already resulted in 1300 lost administrative, teaching and support positions.

Now what we really want to know is why those demanders of limited government and budget reductions and tax cuts have yet to put out their press releases expressing outrage at this largesse on the shoulders of the taxpayers. Where is Americans for Prosperity? What say you, Flint Hills Center? What about you, Kansas Club for Growth? Why so quiet, Kansas Chamber?

Wichita Eagle takes on “disingenuous” legislators

On the editorial pages of the Wichita Eagle today, legislators (and specifically State Senator Susan Wagle) were taken to task for misrepresenting the impact of proposals to temporarily delay certain tax cuts. They referred specifically to the delay in the phase out of the franchise and estate taxes and decoupling from the federal tax code.

The Eagle referred to “a commonsense proposal supported by Gov. Mark Parkinson to delay reductions in corporate franchise taxes and estate taxes, which would save the state about $19 million in lost tax revenue next fiscal year” in taking on Wagle and others.

Said the Eagle, “…some state lawmakers and business groups are claiming that temporarily delaying the phase-in of some tax cuts is a tax increase. By definition, a tax increase requires taxes to actually go up, not stay the same.”

They also referenced a very slick four-color, four-page mailer sent to voters by State Senator Susan Wagle in which Wagle claims she is fighting a “massive state tax hike.” The Eagle called the mailing “disingenuous.” By reference they made called out the Kansas Chamber of Commerce for the same offense, telling readers that “(T)he Kansas Chamber of Commerce also has been portraying any delay in tax cuts as a tax increase.”

Read the full editorial for yourself by clicking here: http://www.kansas.com/opinion/editorials/story/800568.html

Senate kills Masterson amendments; advances responsible 2010 budget

When we last reported the Senate was deep in debate on HB 2373 – their omnibus budget bill for 2010. They had adopted an amendment increasing the across the board cuts for all agencies from 2.5 per cent to 2.75 per cent. This would result in a decrease of an additional $8 on BSAPP bringing it to $4384.

Senator Ty Masterson (R-Andover) offered two amendments. The first would stop some revenue sweeps under which the state brings some money back into the state treasury from fee-funded agencies or other units of government. He had a second amendment to increase the across the board cuts from 2.5 per cent to 3.5 per cent. It had been rumored that he would increase the cuts to 3.0 per cent and add in a state employee pay cut. Instead, he took all the money in cuts.

After a lengthy debate on both amendments, both failed. The amendment to stop the “sweeps” failed on a vote of 17 to 20; the cuts failed on a vote of 17 to 22.

Those voting NO on the tax cuts were (Democrats in italics):

Pat Apple, Pete Brungardt, Jay Emler, Olathe Faust-Goudeau, Marci Francisco, David Haley, Anthony Hensley, Tom Holland, Laura Kelly, Kelly Kultala, Janis Lee, Carolyn McGinn, Steve Morris, Tim Owens, Roger Reitz, Jean Schodorf, Derek Schmidt, Vickie Schmidt, Ruth Teichman, Dwayne Umbarger, John Vratil, and David Wysong.

All other Republicans and Democrat Chris Steineger voted in favor of bigger cuts to education and all other state services.

Senator Les Donovan (R-Wichita) became ill and was away during the voting.

After the failure of the Masterson amendments, the bill was advanced and then put up for a final action vote. It passed on final action on a vote of 17 to 22.

This bill now goes to the House for consideration.

House Appropriations Committee meets; adopts new plan to gut schools in 2010 budget

The House Appropriations Committee was called together at 5:00 tonight under orders from House Speaker Mike O’Neal (R-Hutchinson).

Rep. Bill Feuerborn (D-Garnett) presented a new budget plan that had been crafted through a series of meetings between Democrats and traditional Republicans. Their plan was not too far off from the one passed by the Senate and contained the Senate’s original 2.5 per cent across the board cuts to state agencies including education.

The committee is, as we have found all year, stacked against the passage of moderate plans and once again rejected outright a plan that was perceived by Chairman Kevin Yoder (R-Overland Park) and Vice Chairman Jason Watkins (R-Wichita) as way too small in the cuts and way to big in the revenue solutions.

On the standard vote of 11 – 12, the committee tossed out the Feuerborn plan and then proceeded to adopt one of their own with much deeper cuts and fewer revenue adjustments.

In fact, the new House plan, adopted on a motion by Watkins, increases the cuts to education from their old plan level of 3.75% to a new high of 4.75%. This action would take Base State Aid Per Pupil down to $4188 – well below the 2006 level. Public safety would get no cut while all other state agencies would be cut 5%.

Watkins and Yoder hope to buy moderate Republican support by tossing in extra money for the physically and developmentally disabled and community mental health centers are meeting their promise to local units of government by paying the so-called “slider” payments. The sliders are more or less reimbursements for damage caused by corporate tax cuts passed by the legislature in prior years.

The House will now have two plans to consider. One is the plan passed today by the Senate that cuts all agencies including education by 2.75% or one that guts every state agency except public safety. The House plan also assumes no revenue solutions and so is designed to preserve corporate tax cuts at the expense of state services.

Now is the time to let your Representative know: the new House plan will lead to significantly higher unemployment in Kansas and will cause long-term damage to the education of a generation of Kansas children. There is a responsible alternative in the Senate plan. Click here to contact your Representative.

House Tax Committee meets to consider new ideas on tax credits

The House Tax Committee was called in at 5:00 today to hear a proposal from Rep. Jeff King (R-Independence) that included a series of proposal mostly related to tax credits.

King was asked to outline his proposals and suggested the following:

• To suspend for two years the community service tax credit and the film production tax credit saving the state $5 million,
• To reduce by 10% all other tax credits except the earned income tax credit, the food refund tax credit, the child care tax credit, and the homestead tax credit saving the state $7.7 million,
• Changing all tax credits except the earned income tax credit from a refund to a “carry forward” into the next tax year saving the state $10.8 million in 2010,
• Reinstituting a three year statute of limitations on claiming tax refunds saving the state $3 million, and
• Reducing the statute of limitations on sales tax refund claims from three years to one year saving the state $15 million.

If all of King’s suggestions were to be adopted, the state would save $41.5 million in 2010.

Kudos to Representative King for seeking additional solutions to the budget difficulties.

The tax committee will meet again tomorrow to hear about these proposals in more detail.

Earlier in the day

Senate debating 2010 budget

The Senate has been on the floor since 9:00 this morning debating Senate Sub for HB 2373 – the 2010 omnibus budget bill.

This bill was much better for state services than the House version that was defeated last Friday night in that chamber. But when things are being debated, anything – good or bad – is possible.

Right out of the chute, the Senate voted to increase the cuts to all agencies from 2.5 per cent to 2.75 per cent. This action would reduce BSAPP by a few more dollars and is about another $8 million cut to K-12 education. There is some speculation that this is an attempt to head off an expected amendment from Sen. Ty Masterson (R-Andover) that would increase the cut to 3 per cent.

The Masterson amendment has not come up yet but word is that it was being drafted this morning. Still unknown is whether or not it also includes a reduction in pay for state employees. Again, word under the dome is that it does include a 2.3 per cent pay cut.

Debate about such pay cuts may be a bit more complicated today as the Lawrence Journal World has broken a story of special pay bonuses that have been made to employees of House Republican leaders. One employee alone – Chief of Staff for House Speaker Mike O’Neal earns $90,000 per year and received a one-time “pay rate adjustment” of $20,000 his first week on the job. 

Read the full story at: http://www2.ljworld.com/news/2009/may/05/some-kansas-republican-employees-getting-special-p/?breaking

House on a long recess

The House, with nothing on their debate calendar, came to the floor at 10:00 am and promptly took a recess until 4:00 this afternoon.

People were wondering if the Appropriations Committee would be meeting to try and craft a new budget proposal but no such meeting was announced.

Waiting for coal?

With the announcement last night that Governor Parkinson and Sunflower Electric CEO Earl Watkins had negotiated a settlement to the long-standing coal plant dispute, both chambers are awaiting the arrival of a new coal bill that can pass both chambers and be signed by the Governor.

The agreement will provide for one coal burning electric plant in southwest Kansas with plenty of “green” offsets. Among those offsets are an agreement to burn 10% biofuels in their plants in Kansas and establishment of new wind farms and transmission lines for a renewable energy portfolio.

Many have wondered if the state budget – or portions of it – would be held hostage to the coal plants as pro-coal leaders try to force anti-coal legislators into voting to override former Governor Sebelius’ veto. The veto override becomes unnecessary if there is broad agreement on the newly brokered plan.

This is another one to watch as it might be bill to break the logjam!

A long day of mostly recess

Both chambers went on the floor to day and quickly took a recess – in the House until 3:00 pm; in the Senate until 10:45.

Now recess in legislative terms is never a fixed time. Senators came back late and quickly took another recess until 1:30. Come 1:30, the Senate stood at ease while the agriculture committee met at the rail to adopt a new milk bill without the controversial labeling provisions. If you’ve at all been following milk, there was a bill to restrict labels on milk indicating that they were free of bovine growth hormones. The bill was vetoed by the Governor.

Upon the resolution of the milk bill, the Senate got back to work, promptly passing it.

We had been waiting anxiously for the scheduled debate of the Senate version of the omnibus budget bill. That debate was delayed for another day as the Senate adjourned for today.

The House, after returning at 3:00, adjourned for the day.

Nothing was accomplished on either the budget or tax issues.

Rumors on the budget front

The Senate budget bill contains cuts of 2.5 per cent to all state agencies including education. This is the bill that the education community is supporting. Unfortunately, keeping the bill at 2.5 per cent means that the legislature must also enact certain revenue solutions. These solutions include the temporary suspension of the phase out of the estate tax and corporate franchise tax and decoupling from the federal tax code.

These measures would save the state $96 million but the Kansas Chamber of Commerce is demanding that they not be passed. Republican leadership in the House has pledged not to disappoint the Chamber. This led to the defeat of the House version of the omnibus appropriations bill on Friday night.

Word has leaked out that Senator Ty Masterson (R-Andover) has a plan to cut all agencies by 3 percent in exchange for not sweeping certain tax revenues into the state treasury. We have heard that his plan also includes a 2.3 percent state employee pay cut. If this is true, it would be the equivalent of a 2.3 per cent payroll tax on state employees specifically to fund accelerated tax cuts for corporate interests.

There is another rumor floating that some Senator might try a comprise position by suggesting a 2.75 per cent cut to all agencies. Whether or not that proposal includes the state employee payroll tax is unknown.

None of this will be known for certain until the budget debate begins and amendments are offered. Maybe tomorrow?

Senate Tax Committee to meet tonight

In other interesting developments, the Senate Tax Committee has announced a meeting tonight. This might be a sign that some may want to consider the revenue solutions we spoke of above.

If they do and a tax bill with the revenue solutions can pass, then we might just see the budget logjam break and a reasonable budget get passed.

We’ll be watching tonight.

House votes down O’Neal’s budget bill!

A coalition of traditional Republicans and Democrats pulled themselves together today to hand a big loss to Speaker O’Neal and his Appropriations Chairman Kevin Yoder.

The O’Neal/Yoder omnibus budget bill that included very large cuts to all state agencies including K-12 and higher education and gutted state employee pay to fund corporate tax breaks was defeated on a vote of 53 – 62.

This repudiation of the extreme nature of the House Appropriations plan should help interested legislators to take a more moderate approach to the budget – an approach that calls for shared sacrifice.

Early in the debate the House stripped out the state employee pay cut on a motion by Appropriations Vice Chairman Jason Watkins (R-Wichita). Since Watkins had made the motion to enact the pay cut, it made some wonder if the whole action wasn’t part of an elaborate game. The pay cut would be a distraction from the large agency cuts and taking it out might suddenly make the bill look “moderate.”

If that was the intent, it clearly didn’t work. Democrats lined up solidly against the plan and they were joined by 15 Republicans in voting NO.

Several amendments took up a lot of debate time. One by Lance Kinzer (R-Olathe) would have restricted state dollars used in family planning agencies. Another by Forrest Knox (R-Altoona) was intended to ban the children of undocumented aliens from attending a post-secondary education institution at in-state tuition rates. This one has been visited time and time again and never passed. It failed again tonight on a vote of 50 – 67.

The vote to advance the bill came about 8:30 tonight. Normally a voice vote, a roll call was demanded.

It is critically important now that the Legislature look at the revenue side of the budget and pass legislation to temporarily hold the phase out of the corporate franchise tax and the estate tax and decoupling from the federal tax code. These changes would save the state $96 million and have no negative impact on business.

Decoupling from the federal tax code is the biggest help, saving the state $77 million. This is needed because federal stimulus bills from the end of the Bush Administration and the start of the Obama Administration have included tax cuts for business. Because our tax codes are coupled, these breaks would be given for the state as well.

By decoupling, businesses still get the federal tax break (estimated to be about 85 to 90 percent of the break) but would stay with current state law for state tax purposes. Most of these tax breaks are accelerations of breaks that are normally spread over several years. Business would still get the state break, just on a longer timeline.

Today’s action calls for thank you’s!

Voting no on the omnibus budget bill today was to take a stand on preserving vital state services from education to public safety to services for the disabled.

We are often quick to blast legislators when things are going wrong – now is our chance to thank them for doing what’s right!

The following legislators deserve to hear from you! Tell them thank you for standing up for schools, for social services, for public safety, for universities, and for state employees.

Democrats:

Barbara Ballard, Lisa Benlon, Tony Brown, Tom Burroughs, Sydney Carlin, Marti Crow, Paul Davis, Nile Dillmore, Bill Feuerborn, Gail Finney, Geraldine Flaharty, Stan Frownfelter, Dolores Furtado, Delia Garcia, Doug Gatewood, Sean Gatewood, Raj Goyle, Bob Grant, Broderick Henderson, Jerry Henry, Annie Kuether, Harold Lane, Judy Loganbill, Margaret Long, Steve Lukert, Ann Mah, Pat Maloney, Melody McCray-Miller, Julie Menghini, Cindy Neighbor, Shirley Palmer, Jan Pauls, Eber Phelps, Gene Rardin, Louis Ruiz, Tom Sawyer, Mike Slattery, Josh Svaty, Dale Swenson, Milack Talia, Annie Tietze, Ed Trimmer, Jim Ward, Vince Wetta, Jerry Williams, and Valdenia Winn.

Republicans:

Bob Brookens, Barbara Craft, Don Hill, Don Hineman, Terrie Huntington, Jeff King, Bill Light, Tom Moxley, Bill Otto, Jill Quigley, Sharon Schwartz, Tom Sloan, Sheryl Spalding, Kay Wolf, and Ron Worley.

We urge you to send these legislators a note of appreciation. They can be e-mailed using the following address pattern: firstname.lastname@house.ks.gov.

Ten legislators missed the vote due to funeral for the father of Rep. Pat George (R-Dodge City ) and the father-in-law of Rep. Brenda Landwehr (R-Wichita). Of those 10, most people agree that their 10 votes would have probably split evenly between supporters and the opposition. Those ten were Democrats Tom Hawk and Don Navinsky and Republicans Bob Bethell, Pat George, Brenda Landwehr, Melvin Neufeld, Jo Ann Pottorff, Charlie Roth, Clark Shultz, and Vern Swanson.

3:30 pm

Big Three Ed groups hold joint press conference

Time for corporate interests to step up

Kansas NEA, United School Administrators/Kansas, and the Kansas Association of School Boards held a joint press conference to day to echo Governor Parkinson’s call for shared sacrifice in pulling Kansas out this budget crisis.

Just a few days ago, the Kansas Chamber of Commerce put out a press release “warning legislators” not to pass the proposed suspensions of corporate tax phase-outs or to decouple from the federal tax code.

In response to the Chamber’s “warning,” House Speaker Mike O’Neal (R-Hutchinson) announced that he would not support the proposals. His Appropriations Committee went into action and cut state employee pay by five per cent. State employees are now being told they will have to pay for the corporate tax cuts!

The Committee Democrats and Republican Bill Light (Rolla) voted against the pay cuts.

Emporia Superintendent John Heim spoke for the three education groups at the press conference this afternoon in which he called upon the legislature to “support the Governor and ask everyone to share the sacrifice.”

To read the full text of the press release, click here.

New revenue collections do slightly better than estimated

In the continuing revenue watch there was a bit of good news yesterday as tax collections did a little bit better than was expected. This should stall talks of cutting more deeply than is already proposed in the omnibus budget bills.

Keep your fingers crossed that it keeps moving up!

Governor Parkinson calls for “shared sacrifice”

Governor Mark Parkinson, in a speech to a joint session of the Legislature, called for and end to partisan posturing and a commitment to shared sacrifice to solve the state’s budget difficulties.

In what was a clear contrast to House Speaker Mike O’Neal’s (R-Hutchinson) remarks of yesterday in which O’Neal assured corporate interests that they would have no sacrifice in getting through our financial crisis, Parkinson called upon the legislature to delay the continuation of certain tax cuts for corporations and decouple from the federal tax code.

Parkinson’s remarks were welcomed by those who want to soften the cuts now being considered for state agencies but will likely draw the ire of the Kansas Chamber of Commerce who held a news conference yesterday in which they “warned” the Kansas Legislature to not enact any changes to tax cuts for corporate interests.

House Appropriations takes up O’Neal’s position on “no sacrifice” for business

The House Appropriations Committee met again today and amended their omnibus budget proposal, putting it now in a Senate Bill (SB 22). In their action, they accepted some revenue “enhancements” proposed by former Governor Sebelius and did not cut state agency budgets any more. But their big money saver was found when they adopted a 5 per cent pay cut for all state employees.

Asked why they excluded employees of Regents institutions from the pay cut (Regents employees are state employees), Rep. Jason Watkins (R-Wichita) informed the committee that if they cut from Regents and kept the money in the state treasury they would be out of compliance with the American Recovery and Reinvestment Act (ARRA).

Eventually, however, they adopted an amendment that cut Regents’ employee pay by 5 per cent but instead of sweeping the savings into the state budget, they leave it in higher education and require it to be used to hold down tuition increases.

Rep. Tom Burroughs (D-Kansas City ) asked why the House Tax Committee has not met to consider the revenue solutions they were asked to take up – the corporate tax provisions that Gov. Parkinson referred to. Chairman Yoder had no answer for Burroughs.

When will the budget be debated?

It looks right now like both chambers may take up their budget bills late tomorrow.

KNEA and the other advocates for the education community are supporting the Senate bill which minimizes cuts to all state agencies including education and depends on the passage of revenue solutions including the suspension of the phase out of the franchise and estate taxes and decoupling from the federal tax code – the very provisions opposed so strongly by the Kansas Chamber and Speaker O’Neal.

What does BSAPP look like under various scenarios?

We have a chart that shows what has happened since the passage of the school finance bill that came as a result of the Montoy lawsuit. The dark blue line shows where we should be according to statutes passed subsequent to the lawsuit. The green line is where we would be under the HB 2373, the Senate omnibus budget bill. The red line shows where we would be under the HB 2022, the House omnibus budget bill. Click here to see the chart.

The blue line (implementing statute regardless of economic conditions) would have BSAPP at $4433 for this school year and, if the full CPI-U requirement were applied to that base, next year schools would receive $4597 in BSAPP. (The legislature passed a statute saying they would meet the CPI-U in school funding.) The Senate plan reduces 2010 funding $4295 or $20 below the 2007 funding level but $38 above the 2006 level. The House plan reduces BSAPP for 2010 to $4236, a full $21 below the 2006 level.

It is important that we keep our eyes on the 2006 level because that is the federal “maintenance of effort” level for receipt of the federal stimulus money. According to the American Recovery and Reinvestment Act (ARRA), a state must maintain education funding at a minimum at the 2006 level to be eligible for ARRA funds. 2006 is also the year before implementation of the three-year school finance plan that was considered by the Supreme Court in dismissing the Montoy school finance lawsuit.

Representative Peggy Mast (R-Emporia) in the House Appropriations Committee and Senator Ty Masterson (R-Andover) in the Senate Ways and Means Committee both made motions to cut education funding even more. Fortunately, their motions failed. The Mast motion, however, failed by only one vote.

Click here to see the chart.

What will we get under the House or Senate plans?

The State Department of Education has released a district-by-district analysis of the impact of the cuts as approved by the House Appropriations Committee and the Senate Ways and Means Committee.

Click here to see what would happen in your district. WARNING: It isn’t pretty!

Remember that both of these plans now move the full chambers for consideration – they could be changed yet!

With all the talk of cuts, why won’t they release the LOB?

As we approach the omnibus session starting April 29, we have to wonder what’s going on with other unfinished bits of education legislation.

One piece of real concern is the conference committee report on Senate Bill 84. The CCR sits right now on the House calendar – it was sitting there when they adjourned. And there is a critical school finance piece in this report. One part of the report would hold the LOB harmless. What this means is that, as school budgets are cut, districts could still levy the LOB as if the state was funding schools at the statutory level.

Without SB 84, when schools get a cut in state aid, their budgets go down and the LOB would automatically follow that budget down. As bad as things are in your budgets with the cuts currently being passed, imagine how much worse it would be if your LOB went down as well!

When communicating with your Representative, urge him/her to demand action on the conference committee report on Senate Bill 84.

Senate finishes budget bill; cuts to education smaller than those in the House

Earlier today we reported progress in the Senate Ways and Means Committee on budget deliberations, letting you know that they had – at that time – decided not to make additional cuts to education and rejected a motion by Sen. Ty Masterson (R-Andover) to cut education by an additional 4.9% or about $150 million. We also reminded you that all that could change.

Through their debate today, the Senators first considered some isolated expenditure cuts and recommended tax enhancements. It had been their intent to deal first with the so-called “rats and cats” items before deciding what level of “across the board” cuts would be needed to get to a $0 or small ending balance.

Those “rats and cats” amounted by about 5:00 pm to $107,300,000 in cuts and $96,000,000 in tax enhancements. Given their target of reaching a total of $350 million in budget adjustments, they were $146,700,000 off. To make up the remaining shortfall and have an ending balance of $0, they would need to make an across the board cut of 2.93%.

The first proposal out was one to make the across the board cut 3.25% which would generate a small positive ending balance of $15,800,000. At that point, Senator John Vratil (R-Leawood) and Sen. Carolyn McGinn (R-Sedgwick) moved to cut education by 2.5% and all other agencies by 3.25%. This would effectively eliminate the ending balance.

After a brief discussion, Sen. Janis Lee (D-Kensington) and Sen. Laura Kelly (D-Topeka) made a substitute motion to put in an across the board cut of 2.5% and to make one additional revenue enhancement from expanded gaming fees to bring in an additional $25 million. Both the Vratil and Lee motions gave the Department of Education the flexibility to take the cut out of those areas in the budget that would do the least harm.

The Lee motion passed and discussion of the budget came to a halt after two more motions were dispatched (one to provide money for the expanded State Children’s Health Insurance Program and the other dealing with public safety).

The committee then put the budget bill into House Bill 2373 and passed it out of committee for consideration on the floor.

So, how do the two chambers compare?

House: An additional cut to education of $113.3 million (3.78%) resulting in a reduction in BSAPP from $4367 to $4236.

Senate: An additional cut to education of $75.5 million (2.5%) resulting in a reduction in BSAPP from $4367 to $4295.

We will now be turning our attention to the tax committees and floor action beginning next Wednesday when the legislature returns for a lively omnibus session.

Governor vetoes sales tax exemption bill!

It was announced today that Governor Sebelius vetoed the sales tax exemption bill we’ve been talking about in Under the Dome.

The veto will save the state budget $4.5 million in 2010 and a cumulative $38 million. The bill contained the exemption for fees and charges for guided and non-guided hunting and fishing excursions, an exemption for the All American Beef Battalion, and exemption for Goodwill Industries, and the repeal of the sunset on a vehicle tax.

We hope that all Kansas law-makers will be responsible about cuts to revenue especially in a time when painful cuts are being made to essential state services.

Senate calling for revenue solutions; resisting bigger cuts

We reported yesterday in Under the Dome that the omnibus budget debate got ugly in the House Appropriations Committee with the adoption of further reductions to education funding for 2010. The House bill (HB 2022) will reduce base state aid by $131 taking it down to $4236, a level below that in place prior to the passage of the three year school finance plan. This represents an additional cut of about $114 million to K-12 education.

The House Appropriations Committee did not recommend any revenue adjustments to offset cuts, passing that responsibility on to their Taxation Committee instead. The House Taxation Committee has shown itself to be very conservative and we wonder how open they might be to revenue solutions. We anticipate that unless there is an agreement between Republican and Democratic leadership, any real revenue solutions in the House might have to be brought forth as floor amendments.

The Senate Ways and Means Committee meeting today took a different approach. They reviewed a laundry list of possible revenue solutions and called for introduction of a number of them as they have debated their version of the omnibus budget for 2010. This action notifies the tax committee in the Senate that they want certain revenue solutions brought forward, allowing them to adopt a smaller cut to education and other state services than that passed by the House.

If all of their suggestions are accepted and passed by the Senate, they would make significant progress in solving the shortfall and offsetting the most painful cuts.

Revenue solutions will have to be taken through the tax committee and considered separately from the budget under the rules governing legislative procedure.

As we write this update, the Senate Ways and Means Committee, on a motion by Senator John Vratil (R-Leawood), has reaffirmed their position on 2010 as no change from the previously enacted budget bill – no additional cut to education.

Prior to adoption of the Vratil motion, they had debated and rejected a motion by Senator Ty Masterson (R-Andover) to cut education by an additional 4.9 per cent. The Masterson motion would have cut education by about $150 million over the cuts enacted for 2010 already. It would have brought base state aid per pupil below the 2006 level, losing all the ground that Kansas had gained over the life of the three-year school finance plan.

Understand that debate and discussion is ongoing in the Senate committee and anything is still possible.

Early effort to make deeper cuts to education fails; later one passes

The full House Appropriations Committee heard from its various subcommittees today to debate and ultimately to adopt their reports.

The Education Budget Committee decided yesterday to cut the K-12 education budget by an additional $100 million by delaying capital outlay state aid payments for one year ($25.4 million), reducing base state aid per pupil to $4257 from the currently adopted 2010 level of $4367 ($70.6 million), and reducing state payments to KPERS by $4 million. This represents an additional 3.3% cut to the K-12 budget.

It also puts Kansas in uncharted territory regarding the American Recovery and Reinvestment Act (ARRA). The act requires states to fund the 2006 school funding level and use ARRA money to come up to the 2008 or 2009 level, whichever is higher. The law also provides a shortfall provision in the event that even when all the ARRA money is used, the state cannot meet the higher level. This action puts BSAPP at the 2006 level. It is unknown how the federal government might react to this proposal.

Rep. Joe McLeland (R-Wichita), chair of the House Education Budget Committee, had tried to move a 5% cut to schools through the committee but was outvoted by the three Democrats who were joined by Republican Terri Huntington in adopting the 3.3% level.

When the report came to the full Appropriations Committee this morning, Rep. Peggy Mast (R-Emporia) made a motion to increase the schools cut to 4.9%. The Mast motion would have cut $150 million from schools and reduced BSAPP to $4177 – well below the 2006 funding level. Mast was one of several Republicans on the committee that blasted the “powerful education lobby.” She characterized her motion as a way of dealing with the “lack of responsibility given by the education community.”

Rep. Tom Sawyer (D-Wichita) offered a substitute motion to leave the education cut at 3.3% and to reduce the 5% cut to the social services budget (Mast chairs that subcommittee) to 3.3%. Sawyer’s motion was withdrawn because the social services budget was not up for debate.

Debate on the Mast motion was long and passionate. Rep. Bill Light (R-Rolla) in expressing his opposition, read out a list of possible revenue changes that would help offset the decline in revenue. Rep. Barbara Craft (R-Junction City ) cited the constitutional requirement to provide funding for education in her opposition to the Mast motion. In the end, the Mast motion failed on a vote of 11 yes, 12 no. All nine Democrats voted no. They were joined by Republicans Light, Craft, and Jeff Whitham of Garden City.

Later in the day, on a motion by Rep. Kasha Kelley, the committee transferred another $16.2 million from education to the public safety budget. While the impact of this is not yet known, it will likely mean a cut of some $13 million to K-12 and the rest from higher education. How it will be taken out is also unknown. After the numbers are crunched, we will know whether this comes off of BSAPP or some other place in the education budget. The Kelly amendment passed on a vote of 12 to 11 with only Bill Light and Barbara Craft joining the Democrats in opposing the cut.

During the debate on the Mast motion, Rep. Jason Watkins (R-Wichita) spoke eloquently about his own disabled child and the challenges he and his wife have helping her. Watkins described the challenges faced by the physically and developmentally disabled and asked committee members to remember how painful large cuts to services for the disabled would be.

We couldn’t agree more with Rep. Watkins. Where we disagree is on what to do about it. While Rep. Watkins uses painful cuts to services for the disabled as rationale for painful cuts to every other part of the state budget, we believe that legislators ought to be finding ways to preserve services for citizens of this state. Instead, while we are making painful cuts to all services, the Legislature has also passed a sales tax exemption on the sale of game birds used in hunting and fees and charges for participation in guided and non-guided hunting and fishing excursions. As a result of this one sales tax exemption, the Department of Revenue estimates a loss of $500,000 per year to the state treasury! Watkins voted yes.

There are painful cuts now being made to every part of the state budget – from K-12 and higher education to services for the disabled, from public safety to state employee pay. Part of this is due to the economic downturn but as has been pointed out repeatedly by us, by other organizations, and by a number of legislators, much of the blame must be reserved for legislative decisions that have created a tax system for the state that is out of balance, unstable, and inadequate.

Legislative tax policy has been generally a policy of cut, cut, cut without regard to the impact on the budget. An excellent example is the easy passage in both chambers of the above mentioned hunting and fishing excursion sales tax cut. And there were a number of tax cuts in this bill. While the one we referenced cost the state $500,000/year, the others cut tax collections by an additional $4 million.

Kansas cannot sustain quality schools or services for the disabled or public safety programs or highway repair until the legislature takes a more responsible approach to taxation. We have been urging the legislature to modernize and stabilize our tax system for five years now and our pleas have fallen on deaf ears. Even today – faced with terrible cuts to state services – legislators hesitate to decouple from federal tax cuts or to simply put a hold on the phase in of other tax cuts.

We’re all looking for a statesman or stateswoman who will stand up and call for a tax modernization commission that can examine our system and help make it into one that is fair to both business and individuals, is balanced, and provides stable resources for needed state services in good times and bad. Unfortunately, that takes guts.

Will education be cut another $100 million?

The House Appropriations Committee and its various subcommittees met today to decide what to do about the shortfall in revenue collections identified by the consensus revenue estimating group (see UTD, April 17, 2009).

The whole committee met in the morning to hear from legislative staff on the revenue shortfall and decisions that have been put off until the omnibus session.

The target is to end the year “out of the hole.” To get to a zero dollar ending balance the state must make adjustments totaling $29 million or about ½ of 1 per cent of the state budget. To do the same for 2010 means adjustments of $328 million or about 5.7 per cent of the budget. It appears that committee chairman Kevin Yoder wants to do more than end even – Yoder apparently wants an ending balance.

After presentations, the Committee broke for lunch and then met in subcommittees. We, of course, followed the education budget subcommittee chaired by Rep. Joe McLeland (R-Wichita).

McLeland began the meeting by calling for a cut of 5% to the education budget (both K-12 and higher education as they must be “cut proportionally” for the purposes of stimulus money under the American Recovery and Reinvestment Act (ARRA).

There was a lot of debate about whether or not this was the right thing to do. One issue is whether or not the state should worry about a positive ending balance in these extraordinary times. Is it more important to have money left over or to simply get to zero right now? Some argue that in these times, getting to zero is enough.

After much debate and the exchange of thoughts on a 5% cut versus a 4% cut, it was decided that the best approach might be to take a dollar amount cut and let the state department decide how best to allocate the cuts within the budget.

Rep. Bill Feuerborn (D-Garnett) moved a cut of $100 million to K-12 education taking $70.6 million from base state aid per pupil (BSAPP) for a cut of $110, $25.4 million by delaying capitol outlay state aid payments by one year, and shaving $4 million off of KPERS contributions. This would reduce BSAPP to $4257 – the same level as the ’05-’06 school year before passage of the three year school finance plan.

Arguing to protect K-12 education were Representatives Feuerborn, Gene Rardin (D-Overland Park ), Harold Lane (D-Topeka), and Terri Huntington (R-Mission Hills). In the end, these four voted to support the Feuerborn motion with Representatives McLeland and Richard Carlson (R-St. Mary’s) voting no. Rep. Clay Aurand (R-Courtland) was absent; Rep. Barbara Craft (R-Junction City ) did not vote. The Feuerborn motion passed.

This is the subcommittee report that will go to the full Appropriations Committee tomorrow.

KNEA is not enthusiastic about the Feuerborn motion. What this does it take school funding to about the level it was in 2006 – this is the “maintenance of effort” level necessary for ARRA. ARRA requires the state to fund the 2006 level and use the stimulus money to come up to (or as close as possible to) the 2009 funding level. This motion uses stimulus money to get to the 2006 level. This might – although we cannot be certain – put the stimulus money in jeopardy.

While the Feuerborn motion is better than the proposal from Republican leadership, it still marks an enormous backward step in school funding, taking funding down to a level set prior to the resolution of the school finance lawsuit.

The subcommittee report – with the Feuerborn motion – now goes to the full Appropriations Committee for consideration. They will meet tomorrow beginning at 9:00 am.

Consensus Revenue group meets; announces another drop in tax receipts

The state’s consensus revenue estimating group met this afternoon and at a 5:00 pm press conference announced their findings. While not good news, it was better than expected by most people.

The target is to end the year “out of the hole.” To get to a zero dollar ending balance the state must make adjustments totaling $29 million or about ½ of 1 per cent of the state budget. To do the same for 2010 means adjustments of $328 million or about 5.7 per cent of the budget.

The downturn in receipts was characterized as “historic.” Never before has Kansas seen shortfalls of this magnitude. It was also pointed out that nearly every other state was in the same position and some were much worse.

Leading up to this point, Republican leaders have been laying the groundwork in their own press events for more cuts to state agencies including education while Democratic leadership has said that enough cuts have been made and it was time to explore revenue adjustments to solve the problem. This difference will likely be the big budget battle of the veto session beginning on April 29.

Budget Director Duane Goossen refused to buy into the “cuts only” questions from the press, instead saying that the 2010 budget needed $328 million “of solutions.”

Governor Sebelius calls for revenue solutions

Governor Sebelius wasted not time in responding to the revenue estimates and reminding legislators that they had left a significant amount of money on the table by not considering revenue adjustments that she had proposed in her budgets. Said Sebelius, “I said earlier this week when I signed the 2010 budget – it’s been clear that state revenues would continue to decline dramatically as a result of the national economic recession. That’s why my budget, and its subsequent budget amendments, proposed millions of dollars in additional savings. Unfortunately, the legislature chose not to take action on a number of these cost saving measures.”

Sebelius was referring to a series of proposals to both suspend the implementation of certain tax cuts and sweep other taxes into the state’s coffers. Her suspensions were ignored by the legislative tax committees while the Senate Ways and Means Committee chose to reject the “sweeps” saying they wanted to hold those proposals in reserve pending more bad news.

The Governor’s revenue adjustments would bring an additional $179.6 million into the state budget.

In addition the Governor called upon the legislature to once again take up the idea of decoupling from the federal tax code. Since the state tax code is coupled to the federal code, whenever a tax cut is made by Congress for federal taxes, it is applied to the state tax system. When the Bush administration passed a federal stimulus bill in 2008, the legislature rejected a bill by State Senator Marci Francisco (D-Lawrence) that would have decoupled one piece of the tax code for one year. It would have saved the state over $80 million at that time.

Decoupling now would save the state another $77 million now.

Taking all of the Governor’s proposals would provide $256.6 million in “solutions” toward addressing the $328 million shortfall.

Not all of her proposals are without controversy. The “sweeping” of all liquor taxes into state coffers would effectively cut tax revenues available to local units of government. Look for some lively debates come April 29.

2010 Commission reviews legislative actions; hears about merit pay

Deputy Commissioner of Education Dale Dennis gave the members of the 2010 Commission a briefing on legislation that has passed or is still awaiting a final vote in the legislature.

Dennis was asked if there was a possibility that some legislation might be held up and used to “twist arms” in an effort to get an override of Governor’s veto of the Holcomb coal plant bill. While it’s hard to imagine any of the pending education bills generating enough controversy to bring enough pressure on opponents of the coal plants, we’ll see what happens later this month. Anything is possible under the dome.

The Commissioners also listened to an overview of merit pay in Kansas and other states. The Legislative Research Department gave a brief overview of what efforts have been made in other states to implement merit pay while Deputy Commissioner Dennis talked about how merit pay has been tried and abandoned in some Kansas school districts.

Dennis also shared two reports with the Commission. The first was the report of the Salary and Benefits Subcommittee of the Teaching in Kansas Commission. This report – developed by a committee of seven administrators and five teachers – provides a variety of “best practices” in developing alternative compensation systems including trust (“a strong interest-based problem solving mechanism between district and union should be a prerequisite for such plans”) and a supermajority of teachers must express acceptance for a change in compensation structures.

The second report Deputy Commissioner Dennis brought to the Commission was the final report of the KNEA Alternative Compensation Study Committee.

KNEA lobbyist Mark Desetti also spoke to the Commission. Desetti shared information about the development of the current compensation system structured on training and experience. The education community, Desetti said, is the one place in America where the gender gap in compensation has been addressed.

“Prior to this single salary schedule, school boards had complete control over who got paid what for teaching. In those days male teachers earned more than women; secondary teachers earned more than elementary. Teachers – who hold a fundamental belief in fairness and equity – were among the first employees to demand and get pay equity. While women generally earn less than men doing the same work in America, the same can’t be said within the teaching profession.”

Desetti also shared some of the history of the failure of systems that are “imposed upon teachers rather than developed with them.”

So now that the regular session is over, where are we?

Conference Committee Reports we’re following

There are six conference committee reports we have been tracking; three in Education, one in Health, one in KPERS, and one in Commerce. Here is where they stand as of today:

The conference committee report on Senate Bill 41 contains the provisions of the original SB 41 plus SB 84 and SB 162. The original bill repealed certain obsolete statutes dealing with school district land transfers. To that was added a provision extending some budget protection to schools districts that dissolve and split their territory between two or more existing districts. SB 84 expands the requirements for financial literacy education in the public schools by requiring standards in financial literacy to be put on state assessments as those assessments are revised. SB 162 establishes standards for disabilities history and awareness.

As originally drafted, KNEA opposed both SB 84 and SB 162 as unfunded mandates. The House amendments to both addressed our objections. KNEA supports SB 162 as amended by the House and that is how it appears in the conference committee report. There was a House/Senate compromise on SB 84 that makes it less troublesome but it still represents an unfunded mandate since there is no provision for purchasing materials or training teachers.

This report has been adopted by the House and awaits Senate action when they return on April 29.

Since SB 84 was put into SB 41, that left the “shell of the bill” available for use. So the conference committee report on SB 84 includes the provisions of SB 73 and SB 74. Senate Bill 73 would allow school districts to continue levying a tax for the LOB as if there had been no cut to school district budgets by the state. KNEA strongly supports this provision. Senate Bill 74 provides an exception to the cash basis law so that school districts can meet expenses including payroll if the state is late in making an aid payment. KNEA supports this provision as well.

As of now, this report has not been adopted by either chamber. It must be adopted by the House before it can go to the Senate.

The conference committee report on SB 161 includes to provisions. First, it allows recreation commissions to establish a petty cash fund with a limit of $1000. The second provision deals with school district contingency reserve funds and raises the cap on those funds from the current 6% of budget to 10%. Districts that are at the 6% now would find themselves over the cap simply because of state budget cuts. This will protect districts from inadve