Kansas House passes budget on heels of court ruling on school funding

The Kansas House passed a budget bill that would enable the governor to delay payments to the pension fund and place restrictions on the University of Kansas’ spending Thursday.

SB 161, which passed 68-56, increases funding for the state’s psychiatric hospitals and funds a 2.5 percent pay raise for corrections officers.

The bill allocates $15.5 billion, including federal dollars, in 2016 and $16.1 billion the following year.

The vote took place the same day that the Kansas Supreme Court ordered lawmakers to address inequities between school districts, a decision that could require the state spend millions more on education.

The Kansas Senate began debate on its own budget bill, HB 2365, around 6 p.m. Thursday, which spends a similar amount.

Neither budget addresses the court’s the order for more education spending. It is estimated to leave the state with a cash balance of $6 million in its general fund at the end of the 2016 fiscal year in June.

Sen. Ty Masterson, R-Andover, called the court opinion irrelevant to the budget debate. He said that lawmakers have until June 30 to address the decision and dismissed attempts to bring up the issue as political grandstanding.

In the House, Rep. Jim Ward, D-Wichita, tried to send the bill back to the Appropriations Committee for more work in House the wake of the court ruling.

“Please, Republicans, do not risk closing schools,” he said, noting that failing to comply with the ruling would result in the closure of schools.

His motion was voted down. A similar motion failed in the Senate later Thursday.

Rep. Ron Ryckman, R-Olathe, the House Appropriations chair, said sending the bill back to committee would hold the rest of state government hostage.

“We have additional work to do,” Ryckman said. “That’s a reason to finish that piece today, not to move backwards.”

Rep. John Carmichael, D-Wichita, referenced the estimated cost of additional funding for schools and said that in his law business, if he had received a $54 million bill, he would not want to write any checks until he knew how he could pay for that bill.

Both budgets use a combination of funding sweeps and budget cuts to address the shortfall the state faces for the current and next fiscal year, including a $25 million sweep from the state’s highway fund for the 2017 fiscal year.

The House bill enables Gov. Sam Brownback to delay payments to the state’s pension fund this fiscal year, a provision strongly criticized by state workers and teachers, but would require the state to pay that money back with 8 percent interest during the first quarter of next fiscal year. It would also bar the governor from sweeping money from the pension fund in 2017.

The Senate bill originally would have allowed the governor to delay pension payments, but Senate Vice President Jeff King, R-Independence brought an amendment on the floor to protect pension funds in both 2016 and 2017.

It passed on a voice vote.

Lawmakers have been inundated with complaints from public school teachers and state workers in recent weeks about the proposed delay to pensions.

Sen. Jim Denning, R-Overland Park, the lawmaker who had first offered the proposal on Monday, said he had fielded phone calls from many constituents who were upset with the proposal and he agreed it should be dropped from the bill.

“We’ll do what our constituents want,” he said.

The House bill adds an additional $3 million to the state hospitals in Osawatomie and Larned, which have been plagued by high staff turnover and questions about gaps in safety. The legislation would also restrict the governor from privatizing the hospitals, an idea that has been floated in recent weeks, without legislative approval.

The Senate budget allocates an extra $2.4 million for Osawatomie State Hospital, which recently lost its federal Medicare certification and stands to lose about $1 million a month as a result.

Both bills have measures to restrict the University of Kansas’ spending in response to the university going to a Wisconsin agency last month to issue $326.9 million in bonds as a way to avoid the need for legislative approval.

The House bill would restrict KU from spending beyond its approved budget without permission from the Legislature. The Senate bill, on the other hand, would forbid the university from spending any tuition or state dollars toward paying off the bonds.

The university’s chief financial officer told lawmakers this week that the Senate’s bill could cause the university to go into breach of contract on the bond deal.

This story was originally published February 11, 2016 at 12:56 PM with the headline "Kansas House passes budget on heels of court ruling on school funding."