Kelly wants review of state tax structure; Education leaders should be involved

By Scott Rothschild

Gov. Laura Kelly says she wants to examine the state tax structure during the interim period before the 2020 legislative session with an eye toward producing a revenue collection system that provides long term stability.
Since half of the state budget goes to K-12 funding, an examination of state taxes is something that school leaders should provide input on and follow closely.

The stability in Kansas taxes that Kelly seeks has been missing from the Kansas tax system for the past decade.

Like most states during the Great Recession, state tax collections in Kansas fell off a cliff in 2008 and 2009. But the second shock occurred in 2012 when Gov. Sam Brownback pushed through huge income tax cuts as part of what he called an experiment.

After the Brownback tax cuts, state services, such as child welfare and prisons, suffered from underfunding while reserves were swept up to keep the state budget afloat. In 2017, legislators, in a bi-partisan move, repealed most of the tax cuts and then mustered up two-thirds majorities to overturn Brownback’s veto.

Since then, state revenues have recovered. Conservative legislative leaders this session tried to implement another round of tax cuts, with most of the benefit going to corporations, but Kelly vetoed the measure and although the Legislature had become more conservative in the past election, it didn’t attempt an override.

“There was an attempt this year to take a U-turn and go off the cliff,” Kelly said.

Kelly said she wants to examine all facets of the Kansas tax system and possibly return to the days when state tax collections were more balanced between sales, property and income taxes.

During a recent town hall meeting in Wichita, Kelly linked taxes and school funding saying, “I can assure you that as governor I will never present a budget to the Legislature that doesn’t respond to our commitment to fund schools adequately.” The crowd responded with applause, but Kelly continued her thought with a warning, “unless the Legislature is successful at passing their tax cuts, which they were not able to get done this year.”

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