Bad budget news: $510 million deficit

By MATTHEW CLARK
Posted Apr 17, 2010 @ 01:35 AM
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When the Kansas Legislature reconvenes on April 28, they will have a clearer budget picture to deal with than when they broke for their spring recess.

On Friday, the much-anticipated Consensus Revenue Estimates projected that the state will face a combined $510 million budget shortfall for the 2010 and 2011 budget.

The estimates indicate a $70 million shortfall for the state budget year that ends June 30 with a shortfall of as much as $450 million for the next budget year that begins on July 1.

“This estimate confirms what we have predicted since the start of the year — despite having already cut more than a billion dollars in state spending, Kansas still faces a $510 million budget shortfall,” said Kansas Gov. Mark Parkinson.

A memo issued from the Kansas Legislative Research Department on Friday, the estimates for FY 2010 was decreased by $46.4 million below the November estimate and the total tax estimate decreased by $104.6 million while the estimate for other revenues increased by $58.2 million.

For FY 2011, there was a decrease of $83.8 million and the new forecast represents a 3 percent reduction below the newly revised 2010 figure.

That memo did state that the primary reason for the reduction was “a net change in $320 million for transfers.” If those transfers had been excluded, or not made, the FY 2011 receipts would have increased 3.1 percent.

“I would have liked a little bit better news, but it could have been a lot worse,” said State Rep. Julie Menghini D-Pittsburg. “We definitely have our work cut out for us.”

Parkinson, who has been an advocate for not making any further cuts to the budget said that more cuts would decimate schools, public safety programs and safety net services for the state.

“Instead, we must implement a temporary solution so that we can create lasting economic recovery,” Parkinson said. “That’s why I reiterate my call for the legislature to return to Topeka at the end of the month prepared to raise the revenue we need to prevent permanent damage to the foundation of our state.”

Lawmakers have said, over the spring break, that there are plans in place to start working on a budget the minute the Legislature reconvenes on April 28.

“We will pass a budget,” said State Sen. Chris Steineger, a Kansas City Democrat. “There are elements for a compromise that was coming together in March.”

He said that the compromise may include more modest budget cuts, with exception to education as well as an inclusion to Parkinson’s proposed one-cent sales tax increase and increases in the tobacco tax — measures that would increase revenues by $380 million.

When the Kansas Legislature reconvenes on April 28, they will have a clearer budget picture to deal with than when they broke for their spring recess.

On Friday, the much-anticipated Consensus Revenue Estimates projected that the state will face a combined $510 million budget shortfall for the 2010 and 2011 budget.

The estimates indicate a $70 million shortfall for the state budget year that ends June 30 with a shortfall of as much as $450 million for the next budget year that begins on July 1.

“This estimate confirms what we have predicted since the start of the year — despite having already cut more than a billion dollars in state spending, Kansas still faces a $510 million budget shortfall,” said Kansas Gov. Mark Parkinson.

A memo issued from the Kansas Legislative Research Department on Friday, the estimates for FY 2010 was decreased by $46.4 million below the November estimate and the total tax estimate decreased by $104.6 million while the estimate for other revenues increased by $58.2 million.

For FY 2011, there was a decrease of $83.8 million and the new forecast represents a 3 percent reduction below the newly revised 2010 figure.

That memo did state that the primary reason for the reduction was “a net change in $320 million for transfers.” If those transfers had been excluded, or not made, the FY 2011 receipts would have increased 3.1 percent.

“I would have liked a little bit better news, but it could have been a lot worse,” said State Rep. Julie Menghini D-Pittsburg. “We definitely have our work cut out for us.”

Parkinson, who has been an advocate for not making any further cuts to the budget said that more cuts would decimate schools, public safety programs and safety net services for the state.

“Instead, we must implement a temporary solution so that we can create lasting economic recovery,” Parkinson said. “That’s why I reiterate my call for the legislature to return to Topeka at the end of the month prepared to raise the revenue we need to prevent permanent damage to the foundation of our state.”

Lawmakers have said, over the spring break, that there are plans in place to start working on a budget the minute the Legislature reconvenes on April 28.

“We will pass a budget,” said State Sen. Chris Steineger, a Kansas City Democrat. “There are elements for a compromise that was coming together in March.”

He said that the compromise may include more modest budget cuts, with exception to education as well as an inclusion to Parkinson’s proposed one-cent sales tax increase and increases in the tobacco tax — measures that would increase revenues by $380 million.

Senate Ways and Means Chairman Jay Emler, a Lindsborg Republican, said that he still believes a “rainy day” fund will help with any future budget issues the state may face.

“Hopefully, this situation will convince enough legislators to support the constitutional amendment and the public will vote to establish the fund in the state constitution,” Emler said. “That would mean the funds could only be used in the event of an emergency, such as we now are facing.”

Sen. Tom Holland, a Baldwin City Democrat, said that there may be some small, internal cuts needed to make a budget package work.

Parkinson’s sales tax increase met with significant resistance in both the House and the Senate during the first 75 days of the Legislative session, but Holland said that was because the discussion was very preliminary.

“The opposition was in the beginning,” Holland said. “Since that time, I think people have heard from their constituents ... I know I have.”

On the Web:
http://budget.ks.gov

Matthew Clark can be reached at matthew.clark@morningsun.net or at 620-231-2600, Ext. 140.

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