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PITTSBURG —
It’s interesting to consider that a governor who won’t push for expanded gaming in the Southeast Zone would rest so much of his two-year budget on several bets of his own.
Let’s start with the income tax cuts that passed last year. The gamble the governor is making is that by cutting income and business taxes, businesses will come to the state and bring in enough money to offset any loss in tax collections.
But in order to gamble, you first have to put something on the line. According to the governor’s own two-year budget, which was released this week, the state will bring in less revenue in 2014 and 2015 than it is now before rising sometime after that. Again: Each year of his two-year budget will see less state revenues than now.
With less revenues, it means that in order to balance the budget, the state will have to make cuts elsewhere.
Looking in more detail at his budget, the cuts aren’t to higher education, which makes up about 12 percent of the budget. The cuts aren’t to health and human services, which are about 16 percent of the budget.
Rather, many of the cuts are to K-12 education, which is close to 44 percent of the budget.
In fiscal year 2014, the governor projects $62.4 million less in total state revenues as compared to fiscal year 2012. For total aid to K-12 schools in fiscal year 2014, he’s projecting a $60.2 million cut compared to fiscal year 2012.
In case we’re accused of skipping over the fiscal year 2013 (current year) numbers, they don’t do the governor any better. The governor expects $193.7 million less in state revenues in 2014 compared to 2013. To fill that gap, he is calling for a $112.9 million cut in aid to K-12 schools in that same span.
That’s if the governor gets his way. It’s another gamble. A three-judge panel just ruled that the state is not meeting the constitutional requirement for school funding. The state constitution requires the legislature to fund a “suitable” education, which courts have determined is $4,492 in base state aid per pupil. The funding last year was $3,838.
The governor gambles that he won’t have to listen to the courts. He does not change base state aid per pupil from 2013 to 2014. In 2015, he calls for a raise, but not to court-set levels. He calls for a raise of $14 in base state aid per pupil to $3,852, still more than $600 less than the amount the courts are calling for.
It’s interesting to consider that a governor who won’t push for expanded gaming in the Southeast Zone would rest so much of his two-year budget on several bets of his own.
Let’s start with the income tax cuts that passed last year. The gamble the governor is making is that by cutting income and business taxes, businesses will come to the state and bring in enough money to offset any loss in tax collections.
But in order to gamble, you first have to put something on the line. According to the governor’s own two-year budget, which was released this week, the state will bring in less revenue in 2014 and 2015 than it is now before rising sometime after that. Again: Each year of his two-year budget will see less state revenues than now.
With less revenues, it means that in order to balance the budget, the state will have to make cuts elsewhere.
Looking in more detail at his budget, the cuts aren’t to higher education, which makes up about 12 percent of the budget. The cuts aren’t to health and human services, which are about 16 percent of the budget.
Rather, many of the cuts are to K-12 education, which is close to 44 percent of the budget.
In fiscal year 2014, the governor projects $62.4 million less in total state revenues as compared to fiscal year 2012. For total aid to K-12 schools in fiscal year 2014, he’s projecting a $60.2 million cut compared to fiscal year 2012.
In case we’re accused of skipping over the fiscal year 2013 (current year) numbers, they don’t do the governor any better. The governor expects $193.7 million less in state revenues in 2014 compared to 2013. To fill that gap, he is calling for a $112.9 million cut in aid to K-12 schools in that same span.
That’s if the governor gets his way. It’s another gamble. A three-judge panel just ruled that the state is not meeting the constitutional requirement for school funding. The state constitution requires the legislature to fund a “suitable” education, which courts have determined is $4,492 in base state aid per pupil. The funding last year was $3,838.
The governor gambles that he won’t have to listen to the courts. He does not change base state aid per pupil from 2013 to 2014. In 2015, he calls for a raise, but not to court-set levels. He calls for a raise of $14 in base state aid per pupil to $3,852, still more than $600 less than the amount the courts are calling for.
It’s estimated that increases to the court levels would be in the range of $400 million a year. If that were the case, Brownback’s budget wouldn’t work. Or at least, he’d have to cut that amount from somewhere else, like higher education or health and human services.
The governor continues rolling the dice. He is gambling that unemployment levels will drop so much from 2012 to 2015, that he can reduce unemployment benefits by more than half.
In fiscal year 2012, the state paid $735 million in unemployment benefits. Brownback believes that will drop to $325 million by 2015. The state unemployment rate is currently at 5.4 percent. We wish the governor good luck with that goal, but it’s a bet we wouldn’t take.
Finally, there’s another gamble the governor is making. He believes that continued cuts to the state income tax will mean the mortgage interest tax deduction will no longer be valuable. He proposes eliminating it. He’s gambling that he’s right, because eliminating that deduction would help offset the lower income tax rates.
We worry that the governor is making a common gambling mistake. We fear he’s making plans based upon possibilities. He wants these things to happen, so he’s planning as if they were true.
But the problem with gambling is the odds are against you. Brownback’s plans only work if he’s right — not about one of these things, but about all of them. If he has to hike K-12 funding, he’ll have to make devastating cuts elsewhere. If unemployment doesn’t plummet as he expects, he’ll have to make that up in something else. If the income tax cuts don’t spur the economy, well, that’s a genie you can’t put back into the bottle.
The stakes are high. The odds are low. The governor is making his gamble. The question is, will he win or will Kansas lose?
For the Morning Sun
