Legislative update from Sen. Pat Pettey, D-6th Dist.
In this issue:
• Session adjourns after 79 days
• April revenue way down
• Credit ratings adjusted down
• Budget passes
• Brownback signs budget, vetoes $5M transfer
• Status of school finance
• Bills signed by governor
• Brownback vetoes lobbying bill
• Brownback vetoes changes to campaign finance act
• Raffle constitutional amendment on November ballot
• What happened to…?
• Harmon students recognized
• Health information
Session adjourns after 79 days
Legislators returned to Topeka on April 30 and quickly wrapped up session. We adjourned in the early morning hours of Saturday, May 3, after just three days, making it the shortest session in 40 years. Last year’s session ended after 99 days. The ceremonial last day of the 2014 session, sine die, is scheduled for Friday, May 30, at 10 a.m.
In the short time that we were in Topeka, the primary focus was passing an updated budget, but we also covered a number of issues that were considered unfinished business for the session, including: the exclusion of the lesser prairie chicken from federal protection, the repeal of renewable portfolio standards, the exemption of property taxes for for-profit health clubs, and the elimination of the mortgage registration fee.
With the session officially adjourned, I look forward to returning home and spending some quality time out in our community. This summer, feel free to contact me at home 913-579-3741 or e-mail me at Pat.Pettey@Senate.ks.gov.
It is truly an honor to serve you.
April revenue way down
Tax receipts for the month of April are down 45-percent compared to April 2013, according to a release issued by the Kansas Department of Revenue. The total receipts came in at $92.3 million below the estimate made by the Consensus Estimating Group.
The nonpartisan Kansas Legislative Research Department indicates that there were no tax sources that exceeded the estimates and the one tax source that fell below estimates the most is the income tax, which came in at $89.6 million or 4.6-percent below estimates.
While Gov. Brownback has attributed this loss to federal issues, the reality is this is the result of his reckless experiment. Revenue is not keeping up with expenses even after the Kansas Legislature has made cuts to K-12 schools, higher education, and vital social services. If we continue on this “glide path to zero” income tax, we could be facing a shortfall of nearly $1 billion by fiscal year 2019.
Credit ratings adjusted down
The day after April revenues were released, Moody’s Investors Service downgraded the credit rating for the entire state of Kansas. The service writes,
“The downgrade reflects Kansas’ relatively sluggish recovery compared with its peers, the use of non-recurring measures to balance the budget, revenue reductions (resulting from tax cuts) which have not been fully offset by recurring spending cuts, and an underfunded retirement system for which the state is not making actuarially required contributions.”
They also downgraded the Kansas Department of Transportation revenue bonds because of the continued transfer of highway funds to the State General Fund. Finally, Moody’s indicated that the phasing in of increasing income tax cuts will “continue to exert pressure on the budget.”
A week later, they released the downgrade of ratings for the University of Kansas and Emporia State University, also citing revenue pressures related to state budgetary challenges.
These changes in credit ratings are the harsh reality of Governor Brownback’s grand experiment to eliminate income taxes.
With the two-year budget that passed last year, there was not as much to tackle this year for the budget except to restore the $360 million in funding for the corrections budget. You may recall that Governor Brownback chose to line item veto part of the budget last year to prevent detrimental cuts from being made to the Department of Corrections. When he did that, it pulled the entire budget for the Department of Corrections for 2015 out of that two-year budget, which is why it had to be restored during this session.
However, the budget agreed to by last minute negotiations in the conference committee – comprised of three House members and three Senators (four Republicans and two Democrats) – also included a one-time bonus of only $250 for nearly 38,000 full-time state employees who haven’t received a raise in six years, a $5 million transfer from early childhood education programs to go towards the Kansas Bio-Science Authority, and a cut of more than half a million dollars to the budget of the Kansas Creative Arts Industries Commission.
The conference committee made no attempt to make adjustments in consideration of the April revenue receipts or the pending court decision on the “adequacy” of funding our school finance formula. They failed to restore any of the cuts to higher education – despite the governor’s statewide tour and promises to do so – or K-12 education, to provide funding for any substantial increase in base state aid per pupil, or to allocate funds to a water plan.
The Senate had the opportunity to debate and vote on a budget bill before regular session adjourned, but because the budget went to the House in the form of a Conference Committee Report, they never had the same opportunity. In essence, the budget was created in three days by four people (the Republicans on the conference committee) with no real debate and no chance to make amendments.
I voted no. The budget denies the stark reality of the situation we face in the out years. Without regard to an honest and realistic understanding of our state’s general fund profile, the Brownback administration is on a reckless course of fiscal mismanagement.
Brownback signs budget, vetoes $5 m transfer
Gov. Brownback signed the budget into law on May 16, 2014. However, he vetoed the line that would authorize a transfer of $5 million from the Children’s Initiative Fund, intended for early childhood education programs, to the Kansas Bio-Science Authority. He made four other minor vetoes, including one that ensures the position of Budget Director within the Department of Administration’s budget remains fully funded.
Status of school finance
On Monday, April 21, 2014, while teachers were still in school, Gov. Brownback signed into law the school finance bill (House Bill 2506), despite thousands of Kansans voicing their opposition and urging the passage of a clean bill.
Gov. Brownback claims this bill is a great accomplishment for Kansas schools. He claims it puts $61 million into classrooms and provides $84 million in property tax relief. He also says that it makes “important educational reform.”
This simply is not true. While this bill may address the equity issue of the school finance lawsuit, it does not send $61 million into classrooms. Instead, it sends $36 million into classrooms – which comes from local property taxes – with an additional $25 million going towards operations aspects of the schools such as capital improvement projects and equipment. The only way to truly send more money into classrooms is to resolve the adequacy issue by increasing the base state aid per pupil.
Additionally, this bill makes unnecessary and unvetted, new education policy such as eliminating due process for teachers, establishing a corporate tax scholarship credit, and adjusting teaching requirements to allow non-licensed teachers to teach certain subjects.
These radical reforms were added to the bill by the Senate in the late hours of the night. There was no opportunity for testimony to be heard, and there was never a fiscal note – only rough estimates – for the cost of the corporate tax credit. This is not how government should be run.
As a result, this bill had no bipartisan support and barely passed both houses. Historically, significant school finance bills have passed with bipartisan support and large majority votes. I did not vote for this bill.
The next step is waiting to hear back from the court. The District Court panel – the same panel that made the original ruling back in January 2013 – is scheduled to review the legislation on June 11 to determine if it sufficiently addresses the equity issues. This panel also is responsible for issuing an updated ruling using the guidelines set by the Kansas Supreme Court on the adequacy of funding the school finance formula.
Bills signed by governor
Gov. Brownback has signed a total of more than100 laws, vetoed two laws, and let one become law without his signature for the 2014 session. Here are some that I thought may be of interest to you:
• Health care compact (House Bill 2553) Permits Kansas to join a multi-state compact where member states would retain full authority over health care rules, regulations, and orders within their respective jurisdiction while still receiving federal dollars up to the amount appropriated for the state under the current federal health care law. The health compact would give the state of Kansas the ability to accept federal dollars for Medicare, but privatize it like it has done for Medicaid under KanCare. I did not vote for this bill.
• Sentencing of veterans (Senate Sub. for House Bill 2655) Enacts new law and amends existing law to allow a defendant at the time of conviction or prior to sentencing to assert that the offense was committed as a result of mental illness, including PTSD, stemming from service in a combat zone while in the U.S. Armed Forces. I voted for this bill.
• Judicial budget (Senate Sub. for House Bill 2338) The omnibus bill that impacts the Judicial Branch’s budget and policies. It is comprised of five different bills from two committees that appropriates $2 million in additional funding from the State General Fund to the Judicial Branch in FY2015; increases filing fees to fund the costs of non-judicial personnel; modifies statutes governing Judicial Branch operations concerning budgeting, the election of Chief Judges, and allowing for a delay in filling judicial vacancies for up to 120 days; and eliminates the statutory requirement for the payment of longevity to Judicial Branch non-judicial staff. I did not vote for this bill.
• Sale of state buildings (Senate Bill 423) Allows the Department of Administration to sell the Landon State Office Building, the Eisenhower State Office Building, the Curtis State Office Building and parking facility, and the Van Buren Project with the sale subject to approval by the Joint Committee on State Building Construction and the State Finance Council. Proceeds from the sale would be divided between the KPERS trust fund and a special revenue fund within the Department of Administration. However, the bill bars any affiliated person from bidding on or holding an interest in a company purchasing the property, this includes state or local officials or family members of a state or local official within five years of the official holding office. I did not vote for this bill.
• Personal injury lawsuits (Senate Bill 311) Increases the caps on non-economic damages in personal injury lawsuits incrementally over the next few years up to $350,000 by July 2022. I voted for this bill.
• Interlock devices (House Bill 2479) Removes a sunset provision related to ignition interlock devices after first test failure or alcohol or drug-related conviction. It also permits individuals with suspended and expired licenses to apply for a restricted license, which allows drivers to obtain insurance and drive legally to work. I voted for this bill.
• Parents anonymity (House Bill 2577) Expands the list of locations where an infant can be surrendered to include police stations, sheriff’s offices, and law enforcement centers. It also protects the disclosure of the name or other identifiable information of a parent or custodian who voluntary surrenders physical custody of an infant under the Newborn Infant Protection Act. I voted for this bill.
• Autism coverage (House Bill 2744) Requires insurance companies to provide coverage for Applied Behavioral Analysis (ABA) therapy for children with Autism Spectrum Disorder. The new law provides coverage of 25 hours per week for children between the ages of 0 and 5 and coverage of 10 hours per week for children up to age 12. This law has no impact on current policies already providing this kind of coverage, such as the state employee plan. I voted for this bill.
• Pharmacy technicians (Sub. for House Bill 2146) Allows the Board of Pharmacy to establish the number of examinations to be passed by a pharmacy technician and the amount of time the technician has to pass those exams in order to become a certified pharmacy technician. I voted for this bill.
• Employer flexibility (Senate Bill 372) Revises provisions pertaining to the Shared Work Unemployment Compensation Program to allow employers to reduce the number of hours worked by employees without having to lay off workers. Employees affected would receive a pro rata share of regular unemployment benefits equal to the percentage of reduced hours. I voted for this bill.
• Unemployment insurance (House Bill 2576) Revises Unemployment Insurance by creating a new rate for employers who started doing business in Kansas July 1, 2014 or later. Employers that fall within the definition established in the law may be eligible for a rate of 2.7 percent for four years. I voted for this bill.
• Medicaid expansion (House Bill 2552) Amends the law pertaining to the guidelines for medical assistance to prohibit the expansion of Medicaid eligibility without the express consent and approval of the Legislature. I did not vote for this bill.
• State fossil (House Bill 2595) Establishes the official state marine fossil as the Tylosaurus and the official state flying fossil as the Pteranodon. I voted for this bill.
• No-call mobile (Senate Bill 308) Expands the authority of the Kansas Attorney General to enforce the Kansas law against telemarketers who call cell phone numbers listed on the registry. I voted for this bill.
• Net metering (Senate Sub. for House Bill 2102) Amends the Net Metering and Easy Connection Act to provide standards for consumers who utilize wind turbine or solar panels on their house to generate electricity currently or in the future related to allowance for generation capacity, time-of-use rate, and minimum bills for rate proceeding. I voted for this bill.
• Farm implements (House Bill 2715) Changes regulations regarding the transportation of farm implements by implement dealers on Kansas highways. I voted for this bill.
• Recycling services (House Bill 2597) Allows municipalities that already provide solid waste collection services to also provide recycling collection services. I voted for this bill.
• Party swapping (House Bill 2210) Prohibits any person from changing their party affiliation in any election year from the date of the deadline for candidates to file for office (June 1) through the certification of the results of the August primary election. I did not vote for this bill.
• Victim notification (Senate Bill 248) Introduced by Senate Democrat Oletha Faust-Goudeau of Wichita, this bill urges the Department of Corrections to notify a victim’s family within 14 days prior to the release of a criminal defendant. The law is now known as Adrian Olajuwon Crosby and Dominique Nathaniel Tyree Green’s Law. I voted for this bill.
• DUI fines (House Bill 2303) A carryover from the 2013 session, it increases the reinstatement fees for driving under the influence (DUI) violations. The fee increases from $100 to $200 for the first occurrence, $200 to $400 after the second occurrence, and so on. It also increases the reinstatement fees for test refusal convictions from $400 to $600 after the first occurrence, $600 to $900 for the second occurrence, and so on. The money collected from the increase of fees will be used in part to fund salary increases for judicial branch (non-judge) employees. I voted for this bill.
• Lesser prairie chickens (2051) Prevents federal regulation of the lesser prairie chicken. It allows the attorney general to block attempts by the federal government to regulate the bird in court. An earlier version of this bill would have allowed state officials to charge federal officials with a felony if they were to try to enforce federal law. The final bill eliminated this language. I did not vote for this bill.
• PACs eliminated (Senate Bill 274) Eliminates three existing leadership PACs that were established by previous legislators and have traditionally been used to help support candidates in elections. I did not vote for this bill.
• Food and farm task force (Senate Bill 286) Includes an extension of certain fees related to agriculture and the legislation introduced by Senate Democrat Tom Hawk (Manhattan) that establishes the Local Food and Farm Task Force. The task force could help farmers understand the opportunities presented by the new federal farm bill. I voted for this bill.
• Mortgage registration fee (House Bill 2643) Phases out the mortgage registration fee and replaces it with a per-page fee increase, expands Rural Opportunity Zones, clarifies a motor vehicle tax exemption and a property tax exemption for certain commercial and industrial machinery and equipment. The elimination of the mortgage registration fee leaves a hole in local budgets. I did not vote for this bill.
• Military funerals (Senate Bill 263) Establishes the Military Honors Funeral Fund in the State Treasury to be administered by the Adjutant General. It also requires the Adjutant General to pay a death gratuity of $100,000 for any eligible Kansas military service member during the course of a federal government shutdown beginning on or after January 1, 2015, if federal funds were not available. I voted for this bill.
• Student privacy act (Senate Bill 367) Outlines what data contained in a student’s record can and cannot be disclosed and to whom. This bill does not prohibit the disclosure of student data for urgent health or safety reasons, but does outline confidentiality requirements. I voted for this bill.
Brownback vetoes lobbying bill
The first bill Gov. Brownback has vetoed this session is Senate Bill 99, which sought to increase the amount of money spent before an individual would have to register as a lobbyist from $100 to $500. The bill passed the Senate unanimously back in February and passed the House 117-6 in March. The veto was sustained.
Brownback vetoes changes to campaign finance act
The second bill Gov. Brownback has vetoed this session is House Bill 2296, which would expand current law and authorize campaign funds to be used for donations to a 501(c)(3) tax exempt organization or any religious organization. It also specifies that if a candidate dies with an open candidate committee account that contains campaign funds, the executor or administer of the candidate’s estate would be responsible for terminating the committee and disposing of the remaining funds. The bill passed the Senate unanimously and the House voted 119-4 back in April. While the veto could technically be overridden by the legislature when they return for veto session, it is unlikely.
Raffle constitutional amendment on November ballot
The amendment to the Kansas Constitution that would legalize charity raffles is scheduled to be included on the general election ballot in November. The proposed amendment would alter Section 3 of Article 15 – which prohibits lotteries with the exception of bingo, betting on dog and horse races, and state-owned and operated lottery – to authorize the Legislature to establish licensing, conduct, and regulation of charitable raffles by nonprofit, religious, charitable, fraternal, educational, and veterans organizations. It passed the Senate unanimously and it passed the House on a vote of 102-19.
What happened to…?
The session moves quickly and sometimes it’s difficult to keep track of what happened to all of the bills that I cover in each of the newsletters. Here’s what happened to those that didn’t make it to the governor’s desk:
• Transparency act pilot program to set up a live camera and audio feed of select committee rooms as proposed in Senate Bill 413 passed the Senate unanimously just before we adjourned for break in April. The bill was then referred to the House Committee on Federal and State Affairs, but never made it to the floor for full consideration during the veto session.
• Property tax exemption for the for-profit fitness clubs, which started out as Senate Bill 72, made it into House Bill 2643 as an amendment, but was later stripped out by House members in a conference committee. Fortunately, it never made it out of a committee on the House side.
• KPERS cost of living increase contained in House Bill 2539 had a hearing in the House Committee on Pensions and Benefits back in February, but never made it out of committee.
• The Health care exchange navigators bill that would require background checks on individuals who work as navigators for the health care exchange passed the Senate on a vote of 30-10. Senate Bill 362 was then introduced in the House Committee on Health and Human Services. A hearing was held, but it never made it out of committee.
• Drug testing teachers and the requirement for teachers to submit fingerprints for background checks passed the Senate on a vote of 30-4. Senate Bill 335 also included an amendment that establishes penalties and procedures for legislators who are subject to drug testing under reasonable suspicion and test positive. However, the bill never made it out of the House Committee on Education.
• Local elections proposed to change to the fall of even-numbered years at the same time as state and federal elections in Senate Sub. for House Bill 2141 never made it to the Senate floor for full consideration and a vote. It passed the House 123-0 in February.
• Tanning bed restrictions for minors as proposed in House Bill 2435 passed out of the House Committee on Health and Human Services, but never made it the floor for full consideration and a vote.
• Financial literacy curriculum and curriculum on the proper handshake passed the House in House Bill 2475 on a vote of 110-12. It was referred to the Senate Education Committee, but didn’t make it any further.
• Storm shelters in schools passed the Senate unanimously. Senate Bill 264 would require a storm shelter to be built at all student attendance centers if constructing a new building or modifying an existing building that does not already have a storm shelter. The bill never made it out of its House committee.
Harmon students recognized
Students from Harmon High School were recognized on the floor of the Senate for their work with the 20/20 Leadership Program. The program was created in order for students to learn about their communities and the Greater Kansas City Metropolitan area and helps break down social, racial, economic, academic and geographic barriers. The students receive 180 educational hours over the course of the 18-month program and the program has over 6,000 alumni. Juniors and seniors at J.C. Harmon High School let the project for the 20/20 Leadership program, which is known as the Harmon Hub. The Harmon Hub will consist of a half mile trail, an outdoor classroom, a spirit walk, berms, seating and markers, exercise stations and student gardens.
Thank you to the American Heart Association for providing health information facts each week during the session. From the AHA: “The average portion size of many foods has increased dramatically. Compared to 20 years ago, the average serving of soda has tripled in size, and the average chocolate chip cookie now has 5 times the calories.”