Kansas agencies, universities asked to weigh 5 percent budget cuts

Gov. Sam Brownback’s budget director has asked all state agencies and universities to study the possibility of a 5 percent cut.

Eileen Hawley, the governor’s spokeswoman, confirmed that budget director Shawn Sullivan had requested the information from state agencies, but stressed that no decision has been made about whether cuts will be needed.

“No decisions on funding levels for agencies will be made until after the November Consensus Revenue Estimating Group meets,” Hawley said in an e-mail. “It is a common practice to ask agencies to think about reduced budgets.”

The revenue estimating group, which includes the budget director and the state’s economists, meets twice a year to determine the state’s revenue outlook. Its next scheduled meeting is in November.

If the group lowers revenue estimates – as it has each of the past four times it has met – then budget cuts could be necessary because the state is already operating at razor thin budget margins.

Senate Minority Leader Anthony Hensley, D-Topeka, said that the administration’s request to state agencies is a sign that Brownback and Sullivan have no confidence in the state’s ability to meet its budget expenses.

“The Legislature passed an unbalanced budget for the first time in my memory and Brownback and Sullivan understand that it’s not sustainable, so as a consequence they have to cut the budget even further,” said Hensley, who has served 40 years in the Legislature.

Brownback issued budget cuts in May and June to help shore up the state’s budget after the Legislature left Topeka, including 4 percent cuts to the state’s Regents universities and to Medicaid provider reimbursement rates.

Breeze Richardson, spokeswoman for the Kansas Board of Regents, confirmed that “all state agencies were asked to forward numbers of what a 5 percent reduction would look like” including the state’s public universities and community colleges, which receive a portion of their funding from the state.

Sheldon Weisgrau, director of Health Reform Resource Project, which is part of the Kansas Association for the Medically Underserved, said health-related cuts would largely fall in two categories – from administrative staffing or from payments to providers through Medicaid, the government insurance program for people with low incomes or who are disabled.

“Either one of those has real problems,” he said.

And additional cuts to Medicaid, he said, could further reduce access to health care around the state and would limit the number of providers who could afford to accept Medicaid patients.

“When you look at providers like rural hospitals, to the extent they’re struggling, this is not going to be helpful,” Weisgrau said.

Rebecca Proctor, the executive director for the Kansas Organization of State Employees, expressed concerns that additional budget cuts could lead to layoffs at state agencies.

“There’s not really any fluff in these agency budgets,” Proctor said.

She said additional cuts would impact everything from the state’s ability to clear highways in a winter storm to the safety of conditions in the state’s hospitals and correctional facilities.

“If you look at the cuts that have already been made, these agencies have already been cut to the bone,” she said.

“I mean, we have cases where you have corrections officers who are working in those facilities every day who don’t have any stab vests available. You have corrections officers who don’t have functional radios,” Proctor said. “You have people working at our state hospitals, where there have already been patient on staff attacks, who don’t have any sort of panic button.

“These things are ridiculous and inexcusable and cutting the budget will only make it worse.”

Dale Dennis, the deputy commissioner of education, said that the administration would exempt most K-12 education funding from the possible budget cuts. Dennis said that the Kansas Department of Education was asked to review a 5 percent cut to small programs and operational costs for the agency.

However, general state aid, special education funding, money for teachers’ pensions and most other major categories of state education aid would not be included in the study, Dennis said.

“They exempted all the big money,” he said.

Moody’s Investor Services noted the state’s “ongoing difficulties in regaining structural budget balance and getting on a path to sounder funding” in an analysis Wednesday, giving the state’s appropriation bonds a negative outlook.

“By continuing to balance its budget with unsustainable, nonrecurring resources, including pension underfunding, it is accumulating large and expensive long-term liabilities that it will be paying off for a long time,” the analysis said.

Hensley said that the state’s budget problems will continue until policymakers “can acknowledge the bogeyman in the room” – the income tax cuts that Brownback ushered into law in 2012.

“We don’t have a spending problem. We have a revenue problem,” Hensley said. “That’s what I’ve always said.”

This story was originally published August 11, 2016 at 12:37 PM with the headline "Kansas agencies, universities asked to weigh 5 percent budget cuts."