Kansas House seeks negotiations with Senate on fixing 2017 budget hole

In this Jan. 17, 2017, file photo, Rep. Kathy Wolfe Moore, D-Kansas City, questions Jay Langley of the Kansas Society of CPAs & Educational Foundation. (Chris Neal/The Capital-Journal)

The two chambers of Kansas’ Legislature will soon undertake budget negotiations to fix a $280 million shortfall in the 2017 budget, after the House disagreed Monday morning with the Senate’s approach.

 

Rep. Troy Waymaster, R-Bunker Hill, indicated the gap between the two chambers isn’t that wide, and he’s hopeful they can resolve differences in their proposals by the end of this week.

“We do need to get something in place so we can get fiscal year 2017 resolved,” said Waymaster, who chairs the House’s budget committee. “And then move on to the mega bill for 18 and 19.”

Kansas is facing a projected revenue shortfall topping more than $1 billion between now and July 2019. Plugging the 2017 hole is just one piece of the puzzle. Next on the agenda will be the fiscal 2018 and 2019 budgets — including court-ordered changes to K-12 education that could increase spending by hundreds of millions of dollars — and tax policy.

The House passed its proposal for 2017 last month, and on Thursday the Senate advanced the legislation but with enough changes that House appointed a negotiating committee.

Waymaster, part of that committee, said the biggest differences between the chambers include their positions on how much to dip into a special long-term investment fund and how to handle the state’s fourth-quarter payment into Kansas’ pension system.

He indicated the House, which had sought to liquidate more than $320 million from the investment fund, could be willing to compromise on that point because January and February tax receipts were better than anticipated. The Senate had suggested drawing half as much from that fund.

On the matter of KPERS, the Senate plan would postpone about $150 million in KPERS contributions and pay the money in gradually over the next 20 years.

Kansas City representative Kathy Wolfe Moore, the Democrat on the House’s three-person negotiating committee, sees a potential sticking point.

“I believe that paying KPERS is more of an obligation and less of an option,” Wolfe Moore said, adding that an effort to pay the money this year would send “a great signal to the KPERS community that we’ve decided to pay our bills.”

The House’s 2017 budget plan would put half of the state general fund balance at the end of fiscal 2017 toward the KPERS payment.

Any delays to KPERS payments are controversial in Kansas because the state has more than $8 billion in unfunded pension liability after more than two decades of systematic underfunding.

Separately, the House took final action Monday morning on a cybersecurity bill that would place 13 Cabinet agencies and their technology personnel under the direction of an IT chief selected by the governor to guide matters of IT vulnerabilities.

The system weaknesses are explained in state audits, but those audits are not public record.

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