Posted on 11/11/2014 8:41:14 AM PST by SoFloFreeper
State revenue forecasters said Monday that the state can expect hundreds of millions of budget dollars less than previously thought to fund schools, social programs and highway projects.
The consensus revenue estimating group lowered the official projections it made in April by $205 million. If accurate, the revised forecast means that Gov. Sam Brownback and legislators will have to raise taxes or make deep cuts in spending during the remaining seven months of the budget year to avoid a $278 million deficit. Additional cuts will be necessary to prevent a $435 million deficit in the next budget year, the analysts said.
In May, Kansas legislators and Brownback approved a budget of about $6.3 billion for the fiscal year that started July 1. That was already more than the state was projected to collect, but a healthy reserve fund was expected to cover the difference. However, lagging tax collections will force the state to spend through its reserves and cut spending.
Budget Director Shawn Sullivan said he was not counting on any tax increases. Instead, he said, the Brownback administration would focus on curbing state spending.
The state of Kansas must continue to live within its means, just as families do every day, Sullivan said.
Sullivan said he would begin working on a menu of options for reducing the budget and discuss with Brownback whether the cuts can wait until the Legislature reconvenes in January. If not, the governor could use his allotment authority to start cutting before then.
Both of those are options, Sullivan said.
Sullivan said he had already identified $100 million in efficiencies that can be implemented without reducing services. He also said the projected deficit in the current budget year is based on the state restoring some programs that it hasnt funded in recent years. He cited the local ad valorem property tax reduction fund as an example. It was once used to help lower county property taxes.
It would be probably fairly reasonable to suggest if we havent funded LAVTR in 10 years and counting, we probably arent going to start now, Sullivan said.
Several factors led the forecasters to lower their projections. The income tax cuts championed by Brownback forced the biggest adjustment.
It's fair to say estimates in April missed the marks, Sullivan said.
A 2012 plan that Brownback spearheaded dropped state income tax rates and eliminated the income tax for owners of about 191,000 businesses organized as LLCs, sole proprietorships or other forms that produce pass-through income.
Sullivan said a one-time drop in taxes paid on capital gains caused by a change in federal tax policy was more to blame for the drop in revenue than structural problems with the Brownback tax plan.
Senate Minority Leader Anthony Hensley, a Topeka Democrat, disagreed.
This is the budget crisis that was self-imposed by Governor Brownback and the Kansas Legislature, Hensley said.
Hensley called the new projections devastating and said the budget crisis was far more serious than I had even thought.
He said the governor and Legislature could not close the gap without affecting government services.
Theyre going to have to cut school funding, raid the highway fund and very likely have to cut social services, Hensley said. There are some very difficult decisions ahead.
Sullivan said economic growth eventually would close the budget gap, even as more tax cuts are set to automatically kick in during the next five years.
The state also ran sudden deficits during the national recession that began in 2008. Then-Gov. Mark Parkinson reduced spending and raised taxes to deal with the drop-off in revenues.
An infusion of federal dollars prevented deeper cuts then, said Raney Gilliland, director of the nonpartisan Kansas Legislative Research Department.
Its not a national phenomenon, so I dont expect the federal government to come to our rescue this time, Gilliland said.
Editorial whining is beginning to happen today ALL OVER Kansas media outlets....as Sam Brownback was re-elected last week and the people will get to keep MORE of their hard earned money.
Ask yourself how many of the liberal pundit whiners, wringing their hands over school budget cuts, are going to WRITE CHECKS from their own personal accounts to help the school in their neighborhood.
Then cue the crickets and watch the tumbleweed roll.
I think that’s called effective governance. Refocus on the core services and cut the fat. It’s how the real world works outside of government fantasy land.
I'm sure some voters would have liked .Gov to have released such forecast before the election.
First off, I’d like to know what the hell a “consensus revenue estimating group” is and is it in any way shape or form related to a “settled science” consensus.
Timing to me seems to a bit retaliatory in nature given recent election events.
IOW, check this sh!t out and vet the “group”.
“...make deep cuts in spending during the remaining seven months of the budget year to avoid a $278 million deficit.”
“...approved a budget of about $6.3 billion for the fiscal year...”
“Deep cuts” are 4.4% of the budget? LOL. They can probably cut 4.4% of their budget by aggressively reducing the amount of office supplies taken home by state workers.
If Brownback had done what the Left advocated, he’d have been chucked out to the unemployment line like Tom Corbett.
Getting government under control is a thankless job.
...make deep cuts in spending during the remaining seven months of the budget year to avoid a $278 million deficit.
A budget of $6.3 BILLION with a deficit of $278 million is a shortfall of less than 4.5%.
Yes, the libs think that less than 4.5% is equal to DEEP cuts. Of course, an INCREASE of 4.5% in taxes would be described by these same libs as a "minimal cost".
Before I saw your post, I did the math too and just posted about it!
In a sense, this is the same thing that tripped up Tom Corbett in PA.
He pulled in the reins on spending, trying to ride things out without a tax hike for a year or two until the economy recovered.
Only under Obama, it never really recovered. The schools went 3, 4 years without an increase in state funding. Local school boards started hiking their property taxes (which, astoundingly enough, they got away with blaming on Corbett).
Then when transportation issues reached a crisis phase he hiked the gas tax, and that sealed his fate.
I would advise Gov. Brownback to hold firm and to not repeat those mistakes.
Kansas has a $6 billion budget.
$200 million is 3% of the total.
I guess “deep” is not as deep as it used to be.
No problem. It’s a point that bears repeating.
Get rid of government vehicles for personal use
Put every penny of spending online for citizen review
Stop funding the arts
Stop state licensing of professions and turn it over to a private entity to offer guarantees of competency and excellence.
Medicaid, welfare and any state entitlement payments should stop at 100% of federal poverty levels
Stop double dipping at the state trough when workers retire from one state agency and then go to work at another state agency for a second pension.
Imagine that, the government will have to live within its means.
Actually, the airwaves and print were plastered with that info by his opposition. Any Kansan that didn't know that there would be a fall off in government tax collect wasn't paying attention.
Key quotation: “State revenue forecasters said Monday that the state can expect hundreds of millions of budget dollars less than previously thought...”
It is a great scam to first makeup a number then proclaim a crisis when the number is not met. The liberals can never lose at that game. So the key thing is to not accept the premise.
As with any budget crisis I will reserve judgment until I see the following:
1. Previous 10 years of actual expenditures
2. Previous 10 years of actual revenue
3. Current year projected revenue
This will help me determine if we are talking about budget cuts versus spending cuts.
“the government will have to live within its means”
The government has no “means”. Just what it loots from taxpayers.
Yes, but usually the politicians loot more when the government spends more than it is allocated.
Wait, where’s the bad news?
If a $205 million decrease can result in a #278 million deficit, then they were already well under water. Sounds like typical political shenanigans.
SoSloFreeper?
On a federal level, every single time federal income taxes were lowered, revenues actually increased to the Treasury as a result of all of the economic activity the tax cuts stimulated.
Some perspective:
Kansas: population 2.9 million. Budget $6 billion
Connecticut: population 3.5 million. Budget $20 billion.
Pennsylvannia: population 12.8 million. Budget $30 billion.
Maryland: population 5.9 million. Budget $37 billion.
Kansas at baseline is relatively sensible when compared to the Blue States, which are out of control.
Starve the beast. If the locals want to spend more money on schools they can vote yes and damn well pay for it.
No they can't. Kansas funds their schools funny. Individual school districts are limited as to the amount of money they can provide through local taxes. Most money comes from the state; it's supposed to be fairer to the rural districts I think.
They were already forecasting a $70 million shortfall back in April. This is on top of that.
Shhh....you’re being too reasonable.
Adding to your point, here is a graph of recent years and their budgets:
http://www.khi.org/photos/2013/nov/07/2647/
By my math, this huge shortfall will leave us with $6 billion to spend...or 12.5% more than the %5.25 billion we spent in 2010....or 23% more than the $4.6 billion we spent in 2005....in an era with near zero inflation and flat population growth.
Sam deserves a pat on the back...oh, we just gave him one last week :)
The government will be taking less of the people’s money?
How is this a bad thing?
This is good news. Start cutting. A good place to start is government head count, inflated government employee pay rates, and pension benefits for public employees.
Any function that a private contractor can perform should be contracted out. This includes giving parents a choice of sending their kids to private schools with partial tax subsidy.
I am in California and our Socialistic leaders would never do these things. We needs conservative states like Kansas to be an incubator for these ideas to prove to the world what can happen with common sense and principled leadership.
How is this a bad thing?
It is not but go read the comments at the link below and you'd think Kansas is full of liberal crazies. From the results of the last election, it is not. I have no doubt it is part of a coordinated effort of the local liberal medias to try to influence public opinion here. They sure tried their best during the last election but failed. Looks like they are continuing down the same path but the people of Kansas have wised up to them.
I personally boycott the advertisers of said local medias that deceive for political gain. Many of these local medias ignored or barely reported the negative stories about Greg Orman and pushed the state is in bad shape because of Brownback meme. I'm glad they all lost big-time but they continue down the path of deception to try to further their libtard agenda. The funny thing is they don't get that is what the American people rejected last week.
http://www.kake.com/home/headlines/Kansas-faces-279-million-budget-gap-by-July-282216831.html
CGato
So the state is running a deficit and you want to make it worse by subsidizing private school tuition?
Average gov't school per-pupil expenditures are about $10k nationwide. Under a typical voucher program, parents are given vouchers worth half of that, or $5k/child.
Vouchers save the taxpayers money, but cost the teacher unions jobs.
A couple of problems with that. Kansas is a rural state, and the overwhelming majority of the school districts are rural districts with no private school alternatives available. Second problem, do you know what kind of income a couple has to have to result in a $5000 state income tax bill? Depending on deductions it's well over $110,000. So again, when the state is facing a deficit why would you subsidize private school tuition?
Taxpayers NOW pay $10k/child in government schools.
Give that same parent $5k to use for a nongovernment school.
Savings to taxpayers: $5k/child.
Fixed costs complicate the issue, but the voucher can always be adjusted to result in a savings to taxpayers.
Regarding distance to schools, existing government schools could be sub-divided into government and nongovernmental schools. Schools could open in storefronts. Students could learn on-line.
Use your imagination. Yours are the arguments of the NEA.
So, he had been prepared to waste $100 million?
So the state is running a deficit and you want to make it worse by subsidizing private school tuition?
The amount of the subsidy would be less than the government entities are currently spending on the public system. This would create a net savings to taxpayers, make some taxpayer/parents happier, and put pressure on public schools and teacher unions to improve in a more competitive environment. Everyone wins.
I like what Reagan once said, “not more taxes but more taxpayers’. Get Bammy outta there and see some growth bring in more state revenues.
The last thing we need is more money to government. I abhor Reagan’s mantra about tax cuts bringing in more revenue as a way to cut the deficit. Cut spending, cut government. Government is the problem and no amount of money will change that.
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