Terry L Calloway

With half of the 2011 Legislative Session behind us, there is time to review the great accomplishments the House has made in the last eight weeks and preview the work ahead. In the first two months of session, the House has made tremendous strides toward reducing the size and scope of government, growing the Kansas economy and increasing personal freedom. With much of the groundwork laid in the last several months, the second portion of the session will focus on tax reform and budget proposals.

Below is an overview of This Session at the Statehouse, a preview of upcoming events and this week’s Kansas Trivia Questions. Also, the Speaker’s testimony before the House Education Committee in favor of HCR 5010 is available.

This Session at the Statehouse

Reducing the Size and Scope of Government

• Pay-Go Rule Provision – HR 6004, the House Rules for 2011-2012 containing the new pay-go provision, passed the House 76 to 45. While this could slip under the radar as a minor tweak to House Rules, it is an integral part of resetting state government to ensure long-term fiscal responsibility. By requiring appropriation-bill spending amendments be revenue neutral, the House can reign in the unsustainable spending that has lead to tax increases. This simple rule modification had and will have a large impact on fiscal policy.
• Full-Time Employee (FTE) Reduction – By passing HB 2014 on an 81 to 40 vote, the House eliminated 2,000 open FTE positions ensuring that state agencies do not receive funding for employees who are not working. This will ensure that agencies are not able to inflate their budgets with unfilled positions.
• Reduction of Agencies and Commissions – The House and Governor have worked together to push several Executive Reorganization Orders (EROs) to eliminate eight government organizations. By eliminating or reorganizing these eight agencies, the state would save approximately $9.2 million. Last week the House voted to establish the Kansas Streamlining Government Commission which will review agencies to make recommendations for efficiencies and to reduce waste before the Commission sunsets on December 31st of 2012.
  Currently, the net effect of the House’s actions on agencies and commissions is a $9.16 million savings but the Streamlining Commission has the potential to save a yet-unknown amount through its investigations over the next twenty-one months.
• School Audits – In August of 2010, the Division of Post Audit issued the results of seven voluntary school district audits. Post Audit found efficiencies that could have saved the state $6.4 million from just those seven districts. Seven other schools have request audits but Post Audit has not been able to conduct them because the funding was cut last year. HB 2014 included funding for three full-time employees to complete the remaining seven audits.

Growing the Economy

• Workers’ Compensation Reform – With a vote of 90 to 29, the House overwhelmingly passed workers’ compensation reform for the first time in seventeen years. This reform will substantially improve the business climate in Kansas. By ensuring injured workers receive the care and benefits they need and increasing our competitiveness with surrounding states, this legislation is a critical part of growing the Kansas economy.
• Paycheck Protection – By passing HB 2130, also known as “paycheck protection,” on a 76 to 45 vote, the House voted to ensure that funds deducted directly from union members’ paychecks are not used for political contributions with which they may not agree. While this is a tremendous step toward increasing personal freedom, it also reduces the cost of labor in the state, making Kansas a competitive location for businesses which in turn results in more Kansas jobs.
• Kansas Health Care Freedom Amendment – Currently, one of the most harmful threats to economic growth is the uncertainty created by the federal health care insurance reform. Without being able to plan on their regulatory expenses, employers are waiting to hire. On a 91 to 27 vote, the House passed the Kansas Health Care Freedom Amendment and took a step toward ending this uncertainty for Kansas employers and citizens. With a stable economic climate, Kansas businesses can focus on growing their operations and creating jobs.
• Privatization Efforts – The House passed HB 2194 on a 68 to 51 vote to establish the Kansas Advisory Council on Privatization. Composed of both public and private sector members, the Council will explore ways Kansas can reduce costs through agency-private sector partnerships.

Looking Ahead

Although the House has made significant progress in the first half of the session, a large amount of work remains. The House plans to focus on the following priorities in the coming weeks.

Reducing the Size and Scope of Government

• Fee Sweep Reform – It has become increasingly common for the Legislature to sweep funds raised by fee-funded agencies for their operational expenses. This requires the fee-funded agencies to increase their fees to cover the basic operational costs. This backhanded manner of increasing revenue is harmful for the agencies and punishes those that have been fiscally responsible. HB 2368, which is currently in the Appropriations Committee, reforms this practice of passing hidden tax increases.
• Ending the Cycle of Education Litigation – Until Montoy, it was well understood and consistently held by the Kansas Supreme Court that that the Kansas constitution requires the Legislature to see that education is funded through an equitable distribution of state funds. The legislature’s role is not to sign blank checks or pay for every item or expense districts choose to offer or incur. HCR 5010 clarifies Article 6 of the Kansas Constitution to be consistent with the legislative history and historic interpretation by the state’s highest court. The Education Committee has held a hearing on this bill and plans to pass it in coming days.
• Income Verification for At-Risk Students – Currently, the funding formula defines at-risk students as those who receive free meals. The at-risk weighting multiplies the base state aid a school district receives by 0.456 per student. HB 2193, which is currently in the Education Committee, HB 2193 would tie the at-risk weighting to the math and reading proficiency of students at the fourth grade and above. HB 2193 would reduce state expenditures by $140 million in FY 2012.
• Enabling law for voluntary consolidation of local government – The Local Government Committee is currently considering HB 2084 which would allow cities and counties to consolidate by dual majority vote.
Repeal of Extraneous Statutes – The House is reviewing and eliminating statutes that are superfluous or no longer relevant. HB 2027 simplifies rules and regulations of filing. It has passed the House and is in the Senate Judiciary Committee. The House is looking for additional statutes that can be abolished to streamline and reset government.

Growing the Economy

• Eliminate corporate and individual income tax on a five-year phase-out plan – The Governor and House are considering using the increase in tax revenue to buy down the tax rate while still leaving a healthy ending balance. The House Taxation Committee is currently working through ideas that will lower the overall tax burden and promote economic growth.
• Unemployment Insurance Reform –The bankrupted employment security trust fund has sustained loans from the US Treasury. The federal government requires the implementation of a surcharge to repay the interest on these loans or threatens the loss of the FUTA tax credit. House commerce is looking at how to implement the required surcharge as well as at limiting unemployment benefits.
• Dynamic scoring of fiscal notes – Currently, before a bill passes the Legislature, the Legislative Research Department puts together a fiscal note explaining the direct cost or income the state will experience because of the bill. However, the economic impact to the state, whether positive or negative, is not calculated. HB 2238 would ensure that Legislative Research track the full economic impact of the proposed legislation. This would allow the legislature to objectively judge legislation on the basis of its potential impact on the Kansas economy.

Kansas Trivia Questions

Question: In 1858 the first institution of higher learning in the state was established. What was the name of this school that is now a community college?

Answer: Highland College.

Question: What Kansas cowtown was known as the “Boarder Queen”?

Answer: Caldwell.