Transcript Kansas Budget Outlook

Kansas Budget Outlook
Washington Days Issue Forum
March 8, 2014
Duane Goossen
Kansas Health Institute
www.khi.org
Opening Summary:
A dramatic tax reduction bill was enacted in the
2012 legislative session.
As a result, lawmakers faced a very large gap
between revenue and spending.
In response, the tax bill was modified and spending
cut in the 2013 legislative session.
Even with the tax modifications and spending cuts,
the state is spending more than it receives.
Lawmakers have already approved budgets for:
Fiscal Year 2014
July 1, 2013 to June 30, 2014
Fiscal Year 2015
July 1, 2014 to June 30, 2015
The governor has proposed budget revisions which
are being considered by the 2014 Legislature.
Future Revenue Stream Restricted
Kansas Income Tax Rates
2012
2013
Top Rate
6.45 & 6.25 4.9
Bottom Rate
3.5
3.0
2014
4.8
2.7
2015
4.6
2.7
2016
4.6
2.4
2017
4.6
2.3
2018
3.9
2.3
Pass-through Business Income Exempt From Tax
2 Percent Limit on Future Revenue Growth
The state will collect $3.7
billion less as a result of the
2012 and 2013 tax bills.
Spending Issues
School Finance Lawsuit
Medicaid Caseload
All Day K
Medicaid Expansion
Restore Cuts
Public Health
Dept. of Corrections
State Employee Salary Increase
KPERS
Judicial Budget
State General Fund
(Dollars in Millions)
FY 2014
(July 1, 2013 to June 30, 2014)
Beginning Balance
Consensus Revenue Estimate
Governor's Revenue Adjustments
Total Available
$
709
5,857
(10)
6,556
$169 million deficit
Approved Spending*
Governor's Proposed Increase
5,995
31
Total Spending
6,026
Ending Balance
*Includes spending authority carrying over
from FY 2013.
$
530
State General Fund
(Dollars in Millions)
FY 2015
(July 1, 2014 to June 30, 2015)
Beginning Balance
Consensus Revenue Estimate
Governor's Revenue Adjustments
$
Total Available
530
5,917
5
6,452
$288 million deficit
Approved Spending*
Governor's Proposed Increase
5,775
430
Total Spending
6,205
Ending Balance
*The Legislature originally approved $6,120
million but the governor line-item vetoed all
funding for the Dept. of Corrections.
$
247
Governor’s
Recommendation
State General Fund
Receipts and Expenditures
$6,500
$6,200
Receipts
$5,900
Expenditures
Dollars in Millions
$5,600
$5,300
$5,000
$4,700
$4,400
$4,100
$3,800
$3,500
$3,200
FY
2000
FY
2001
FY
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
2012
FY
2013
FY
2014
Gov.
FY
2015
Gov.
Closing Summary:
The governor’s spending proposals for FY 2014 and
FY 2015 can be financed by drawing down the
state’s bank account, but are not sustainable in the
future.
The state’s revenue stream does not support
current spending patterns or allow for new
investments.
Lawmakers will be required to make hard decisions
to balance revenue and spending.