Governor says he will sign “nuclear option” tax cut after Senate rejects alternative bill
Governor Sam Brownback says he will sign the so-called “nuclear option” tax cut bill sent to him last week, a measure that could eventually compel state government to significantly cut general fund spending.
The statement came after the Kansas Senate, on a procedural motion, rejected a move to continue consideration of an alternative income tax cut that many Senators thought was still too costly.
The action by the Senate came at mid-day Friday on an 18 to 21 vote to move the process forward.
Following the vote, the Senate President’s office issued this news release:
Senate Offers Responsible Income and Property Tax Proposal
Topeka – After a procedural vote rejecting the agree to disagree motion on the latest version of the governor’s tax plan, Senate leaders urged tax conferees to go back to the negotiation table one more time to achieve responsible income tax cuts for all Kansans without increasing taxes on working families or new businesses that are about to hire thousands of people.
“We are asking for a responsible tax package that addresses the concerns of a large majority of Kansans while leaving room in the budget to restore cuts to classrooms and public safety,” said Senate President Steve Morris, R-Hugoton. “If we do not show good faith and restore cuts to education, the courts may certainly require us to add money to education this summer.”
The Senate offer includes lowering the top two income tax rates to 5.8% and the bottom rate to 3.25%. Current rates are 6.45%, 6.25% and 3.5%. Business income would be exempted up to $100,000 with a three year sunset to re-evaluate its effectiveness. Other provisions included would be $45 million in property tax relief, an adjustment to the High Performance Incentive Program, a 24-county Rural Opportunity Zone expansion and a severance tax trust fund proposal that had unanimous support in the legislature before being vetoed by the Governor. All other items would remain as they are in current law.
“The Governor has told numerous Senators that the state cannot afford House Bill 2117. The bill on his desk could well bankrupt the state and lead to massive cuts in our classrooms, roads and public safety,” said Senate Vice-President John Vratil, R-Leawood. “It is the Governor’s responsibility to the state of Kansas to veto House Bill 2117.”
It does not appear at this time that the tax negotiators will meet again.
Sam Brownback’s Office issued this news release:
Governor Brownback will sign pro-growth tax legislation
Topeka – Kansas Governor Sam Brownback issued the following statement today in response to the Kansas Senate’s decision not to consider the latest tax reform compromise agreed to by the Tax Conference Committee.
“It is unfortunate that the Kansas Senate has refused even to debate a tax compromise bill that would have provided Kansans tax relief. However, strengthening the Kansas economy cannot wait. We will have pro-growth tax reform in Kansas this year that will create tens of thousands of jobs and will make our state the best place in America to start and grow a small business. I look forward to signing the bill on my desk and I call on legislators to finalize their work on the budget based on the enactment of Senate Sub. for HB 2117. The legislative session needs to conclude.”
The Governor’s office will release details for the signing ceremony of Senate Sub. for HB 2117 early next week.
Following the vote, the conference committee on the budget began working again. The negotiations had been stalled while the House waited to see what the Senate would do on the income tax cut.
It now appears the 2012 Legislature is preparing to adjourn sometime Saturday or early Sunday. House Majority Leader Arlen Siegfreid (R-Olathe) told the representatives not to make any plans for Saturday night.
The Governor’s has reiterated several times that he will sign the income tax cut if the Legislature does not send him an alternative, saying he believes the income tax cuts will produce “tens of thousands” of new jobs.
However, the projected deficits have all but the most conservative of legislators deeply concerned for the state’s future. Many believe the cuts would do major damage to the ability of the state to provide many services that are routinely taken for granted by the public.
There are indications that proponents of the “nuclear option” bill are preparing to question the numbers provided by the Kansas Legislative Research Department, one of the more highly respected agencies of state government.