Kansas officials cut revenue projections, leaving state with $400 million gap in next budget

bug


We also have more stories about:
(click the phrases to see a list)

Subjects:

Places:

 


TOPEKA, Kansas — Kansas must fill a $400 million hole in its next budget after officials cut projections for tax collections from now through June 2016, a top adviser to Republican Gov. Sam Brownback said Monday.

Budget Director Shawn Sullivan said the governor plans to outline proposals this week for the GOP-dominated Legislature that would trim up to $90 million in spending during the fiscal year that begins July 1. Sullivan said much of the savings would come from lower-than-expected social services costs, and the governor expects to spare public schools and higher education.

But the remaining gap still would be far larger than the $150 million in general tax increases that Republican legislators anticipated needing to balance the budget.

The state's budget problems arose after Brownback successfully pushed lawmakers to cut personal income taxes in 2012 and 2013 in an effort to stimulate the economy. The governor wants to preserve those cuts as much as possible.

"We will work with the Legislature to structurally balance the budget and hopefully continue the trend toward lower income taxes," Sullivan said during a news conference announcing the forecast.

The new outlook issued Monday reduces projected tax collections by a total of $187 million for the current and next fiscal years. It revised a forecast made in November, which itself was more pessimistic than one from April 2014.

The forecasters reduced the estimate for total tax collections for the current fiscal year by nearly $88 million, or 1.5 percent, to about $5.7 billion. They also cut the tax estimate for the next fiscal year by nearly $100 million, or 1.7 percent, also making it almost $5.9 billion.

The new forecast also reduced the official projection for total tax collections in the fiscal year beginning in July 2016 by $88 million, or about 1.4 percent, making it about $6 billion.

Raney Gilliland, the director of the Kansas Legislative Research Department, said the latest forecast reflects a state economy that is growing, but not as much as the national economy. Most of the reductions in projected tax collections were in corporate income taxes, sales taxes and oil and natural gas severance taxes.

Sullivan said the gap between the state and national economies would be greater without the income tax cuts championed by Brownback.

But Democratic leaders said the latest forecast shows that Brownback's tax policies are a failure.

"We cannot afford to stay the course any longer," House Minority Leader Tom Burroughs, a Kansas City Democrat, said in a statement.

Brownback has proposed raising alcohol and tobacco taxes to balance the budget and has said he's open to boosting the state's sales tax.

The state had projected its budget shortfall for the next fiscal year at about $600 million, but GOP lawmakers were confident that they'd drafted proposals would erase three-quarters of it before the new fiscal forecast. Legislators are taking their annual spring break and plan to reconvene April 29 to wrap up the year's business.

"We are going to look at all revenue options and pursue the fairest and least harmful route," House Taxation Committee Chairman Marvin Kleeb, an Overland Park Republican, said in a statement.

Jeff Glendening, Kansas director for the small-government, anti-tax group Americans for Prosperity, influential among GOP conservatives, called for spending cuts.

"Raising taxes is not the answer," he said in a statement.


Follow John Hanna on Twitter at https://twitter.com/apjdhanna .

All content copyright ©2015 Daily Journal, a division of Home News Enterprises unless otherwise noted.
All rights reserved. Click here to read our privacy policy.