KEPC UPDATE: Cut spending? Prison problems? June revenue, T-WORKS, school finance, college costs and benefits

In this issue …

  • Cut spending? What about prison problems?
  • June revenue growth came largely from corporate taxes
  • T-WORKS Progress
  • Preparing for school finance arguments
  • What a degree costs and can get you

 

Cut spending?  What about prison problems?

The media spin from the Brownback Administration about the income tax bill has been to criticize the legislation and the veto override and to talk in general terms about the need for spending cuts.

In an op-ed in the Wichita Eagle July 2, Revenue Secretary Sam Williams talked about the need for “cuts and efficiencies.”

In the same editorial section, Americans For Prosperity’s Kansas State Director Jeff Glendenning criticized the tax increases and condemned “soaring government spending.”

There was something else both of these op-ed pieces had in common.  Neither mentioned specific suggestions for what to cut.  That seems to be a common theme among those who criticize the legislation: don’t be specific; be general.

There’s no mention of the state budget cuts that have already occurred over the past decade or their impact.

No mention that the T-WORKS transportation program has been reduced to basic preservation after billions in transfers.  This year’s budget authorizes $400 million in bonding over the next two years specifically to be used for preservation work on the state’s roads.  We’ve been reduced to borrowing just to fill the potholes.

No mention of the state employees who have gone without a raise for nearly a decade because of the cuts that have already taken place, but are finally getting an increase this year.

No mention of the years of tuition hikes for post-secondary education as state aid to Regents Institutions has decreased in real dollars, making it harder for young people and their families to afford a higher education.

No mention of the shortage of highway patrol officers in over 30 counties, resulting in many counties without coverage.

No mention of the systemic problems in our state mental hospitals, and that inadequate spending on security has resulting in federal Medicare funds being halted to Osawatomie State Hospital after the investigation into a 2015 sexual assault.  The cost to the state is a million dollars a month.

I found it particularly ironic that the two op-eds with their anti-spending rhetoric occurred in a week where the long period of state budget stagnation likely resulted in the disturbances at the El Dorado Correctional Facility that began June 29.  The situation was resolved later that day.

Reports indicate that some prisoners refused to return to their cells and reportedly took over sections of the prison.

According to the Associated Press: “The union has said for weeks that the prison is understaffed and its inmate population has increased by about 200 inmates over the past three months, to about 1,900.  The state has boosted its capacity by double-bunking some cells as it transferred inmates in, including from other prisons.

‘The pressure of having fewer staff, more inmates and double-bunking was a recipe for some type of occurrence like this,’ said state Rep. J.R. Claeys, the Republican chairman of a budget subcommittee on public safety.”

It had been announced earlier in the week that employees at the El Dorado facility would start working 12-hour shifts to cope with the staffing shortage.  That was to begin July 1.

So, where is the state supposed to cut and become more efficient and what’s your solution for our roads, our higher education, our state hospitals, our law enforcement, and our prisons?

Please be specific.

 

June revenue growth came largely from corporate taxes

June revenues for the state of Kansas came in $72 million over the estimates, according to the Kansas Department of Revenue.

The biggest increase came from corporate income taxes, which are notoriously hard to estimate.  It’s important to note that the 2012 Kansas income tax cuts did not impact corporate income taxes for business.  Those are paid by C corporations, as opposed to the 2012 tax break (repealed by the 2017 Legislature) for business pass-through entities.

Those C corporations made up the biggest piece of the increase, exceeding estimates by about $39 million.

Individual income tax collections (where business pass-through entities would be located) were up $22.8 million over estimates.  Sales tax receipts beat the estimates by $11.5 million for the month.

 

T-WORKS Progress

Where are we on transportation projects in Kansas after the 2017 legislative session?

Economic Lifelines, the statewide transportation coalition, put out a summary of what to expect.  Here’s our summary of what they said:

KDOT has begun the process of letting additional critical preservation projects based on the $400 million in additional bonding authority authorized by the 2017 Kansas Legislature (see the first story in this newsletter, above).

In January, KDOT planned to let only $43 million in preservation projects during FY 18, but will now spend about $320 million in both FY 18 and FY 19.

For FY 18, $115 million will be spent on “1R” projects.  Examples of these types of projects are overlays, seals, patching and surfacing work.  1R projects help to ensure the full useful life of roadways and protect the investments already made to the system.

$143 million will be spent on heavy preservation projects.  Examples of these projects are bridge replacements or sections where full reconstruction may be necessary.  Two of the main projects that will be programmed during FY 18 are:

  • I-70 in Wyandotte County at the Lewis & Clark Viaduct over the Kansas River in Kansas City Kansas
  • I-70 in Gove County from one miles west of K-23 to 4 miles east of K-211, which will be let in April of 2018. Other heavy preservation projects can be expected in Edwards, Allen, Sheridan, Hamilton, and Butler Counties during Fiscal Year 2018.

The rest of the funds will be programmed to yet-to-be determined 1R projects.

Because these projects are based on borrowing, the funds cannot be swept in to the state general fund by future legislatures.

 

Preparing for school finance arguments

Now that the Kansas Legislature has passed school finance legislation that replaces the block grants of the past two years, the Kansas Supreme Court has scheduled oral arguments in the school finance lawsuit for July 18.

There seems to be a consensus among legislators (including pro-education lawmakers who don’t think the state did enough) that the Court decision, whatever it is, will NOT require a special legislative session this summer or fall.  Instead, any changes would be allowed to take place by the 2018 Legislature.

In Court briefs filed on the lawsuit recently, the districts suing the state say what the legislature approved is about $1.5 billion short of what’s needed.  Their attorneys are asking the Court to order more money be provided by September 1.

Attorney General Derek Schmidt, representing the state, says the increase is sufficient under the state constitution to pay for a suitable education for every child.

 

What a degree costs and can get you

What does a higher education degree from a Kansas public institution cost?  How much can you expect to earn if you get one of these degrees?

The Kansas Board of Regents has updated that information here.

A 2016 Kansas law requires the Regents to make the information available as an online tool.  It reviews cost and earnings data from real graduates for each undergraduate degree program offered at a public university or college in Kansas.

Known as Kansas DegreeStats, the newly updated information has been expanded to include each degree offered at 26 public colleges in Kansas, along with employment data for graduates who work in both Kansas and Missouri.  That’s information on more than 1,100 undergraduate degrees.

Information includes reports on typical resident tuition, fees, room and board, and books and supplies.  There’s information on the typical length of time it takes students to complete each degree program, along with scholarships, grants, loans, etc.

The site allows side-by-side comparison of up to three degrees.