Senate President Susan Wagle is eager enough to pass a bill that will affect how much thousands of Kansans owe on their taxes that she has taken the unusual step of creating a new committee focused solely on it.
The move signals Wagle’s intent to pass a tax bill even as new Democratic Gov. Laura Kelly has warned lawmakers against making tax changes this year.
The committee is so new that no lawmakers have yet been assigned to it.
Wagle wants to move quickly: She previously said she hoped to pass a tax bill within the first two weeks of session, and lawmakers are in their second week.
Some Kansans will owe additional state taxes this year because of differences between the state tax code and the federal tax code. In some cases, they will no longer be able to itemize their state taxes.
That ultimately means additional revenue for state government.
Many Republican lawmakers support changing the tax code to eliminate the higher tax bills, returning a so-called tax windfall to Kansans.
“I wanted one committee to focus on any changes that need to be made in state law to make sure all entities in Kansas can have the full benefit of the federal rate reductions,” Wagle said on Tuesday.
She said she doesn’t have a number for how much revenue would be affected. An early estimate from the Kansas Department of Revenue from December 2017 pegged the amount at roughly $140 million this year.
Kelly has said repeatedly that she wants lawmakers to leave taxes alone this year as she seeks to fund and build support for Medicaid expansion, foster care improvements and additional education spending.
She has said the full scope of the 2017 decision to reverse much of former Gov. Sam Brownback’s income tax cuts is not yet known and that Kansas cannot afford to make inaccurate assumptions about the future.
“Recovery from the Brownback experiment is underway, but we have no margin for error,” Kelly said last week. “After fighting so hard to stabilize our fiscal health, we must resist temptation to jump back into a hole.”
Just last week, the committee that typically considers tax bills was working on Senate Bill 13, which would have addressed the windfall. But on Friday, Wagle took the legislation away from the committee and instead placed it with the committee she had just formed.
The move effectively sidelines the existing tax committee in the development of a windfall tax bill.
“You’ll have to speak to the Senate president about that,” said Sen. Caryn Tyson of Parker, chair of the existing tax committee, about Wagle’s decision to take the bill away from her committee.
Tyson said the committee she chairs will continue to study the windfall issue, “but as far as where action is taken, that’s up to the Senate president.”
Wagle said she wanted a single, stand-alone tax bill focused on the effects of the new federal tax law. She said she went to Tyson and asked for a stand-alone bill. Wagle indicated she didn’t get the answer from Tyson she wanted.
Asked about Wagle’s comments, Tyson said it is the Senate president’s prerogative to create new committees. But she also said the tax committee had worked on the windfall issue last year.
Sen. Tom Holland, the ranking Democrat on the tax committee, said Wagle’s decision “fosters suspicion” about what happens in the Legislature.
“From the get go, you can tell Senate leadership – they’re hot to trot to get something across the Senate chamber floor yesterday on this issue,” Holland said. “I think what they’re trying to do is basically pull a fast one before people really start to understand the ramifications of what this ‘windfall’ means and really the best way to address the issue.”
Although Wagle wants to advance a tax bill quickly, it is unclear whether Republicans would have enough votes to override a likely veto from Kelly. A handful of Republican defections would be more than enough to sustain a veto, assuming Democrats universally oppose the legislation.