TOPEKA – Changing tactics in an attempt to break gridlock over a budget deficit, House and Senate negotiators reached agreement Tuesday to move a budget bill to the House floor.
The bill, SB 112, falls about $390 million short of closing the state’s $400 million budget gap. Making it balance would require the Legislature to pass a global tax increase plan, which it so far has been unable to do despite weeks of trying.
Ordinarily, the Legislature would pass its tax bill first and then finish the session by passing the budget.
But the Republicans who dominate the House and Senate are deeply split over how – or even whether – to raise taxes to offset a shortfall largely created by tax cuts in 2012. The Senate inched forward Tuesday on a placeholder plan that could be used as a vehicle for a final tax plan.
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Leaders are hopeful that moving the budget bill first will set the target and bring pressure on members to compromise on the taxes needed to fund it.
Passing a budget also would allow the state to avoid furloughing workers on Sunday.
The budget conferees sent an alternative bill that would close the $400 million gap through deep cuts to schools and social services.
That bill, HB 2135, would impose a 5.7 percent across-the-board cut on state government. Only payments on state debt would be exempt from the cuts.
Sen. Ty Masterson, R-Andover and chairman of the Senate Ways and Means Committee, asked for that bill, saying some Senate Republicans wanted a chance to vote on a bill based on cutting spending rather than raising taxes.
House negotiators agreed to send the bill on so the Senate can have that vote.
“It’s not one that I see supporting, myself, on the House side,” said Rep. Ron Ryckman Jr., R-Olathe.
Early Tuesday, Masterson proposed passing another alternative bill to impose a 2 percent cut on state administrative agencies, sparing schools, most public safety, state hospitals, social service caseloads and debt payment.
But he pulled back that third option, saying he wanted to save it for later.
Ryckman said passing the budget will solve one piece of the puzzle while the debate on taxes continues.
Democratic members of the budget conference committee wouldn’t sign off on the budget bills. House Republicans executed a procedural maneuver that will allow the bill to go to the floor without Democrats’ approval.
The budget bill is set to be considered by the House on Wednesday. If it passes there, it would head to the Senate.
The Senate voted on a preliminary budget bill two months ago. The House has yet to vote on any budget bill. That has bothered some House members, who say the Senate has been in control of the process.
House leaders also have held off on tax debates while they waited for the Senate to act.
After three straight days of battle, the Senate limped toward crafting a tax plan Tuesday evening.
The Senate failed to pass comprehensive tax plans on Sunday and Monday. As it stood early Tuesday, the chamber’s tax bill, HB 2109, would have increased the budget shortfall by about $80 million.
Senators voted 21-17 in favor of an amendment offered by Senate Vice President Jeff King, R-Independence, that would raise about $33 million.
King’s amendment included only policy pieces that have found broad consensus among Republicans. It would grant amnesty to people who owe back taxes in the hope they will be encouraged to pay them without penalties and would close an exemption that allows people to avoid sales tax on items they donate to charity.
It stripped out parts of the bill that would have cut the sales tax rate and created an income tax exemption for low-wage workers.
Republican leaders contended that approving a partial plan would allow the Senate and House to enter negotiations on a budget fix, but a coalition of Democrats and conservatives voiced strong opposition.
“How do we fill a $400 million hole with a $33 million cork?” asked Sen. Jeff Melcher, R-Leawood, who has emerged as one of the leading voices against tax increases.
King replied that when he fills a hole in his backyard, he does so with one shovel of dirt at a time.
‘Need to fix it’
Melcher and other conservatives raised concerns that negotiators may seek to roll back an income tax break for business owners.
Sen. Les Donovan, R-Wichita, the Senate Taxation Committee chairman who will lead negotiations for the Senate, said he had no plans to do so because the governor has already threatened a veto.
Donovan, who has carried several tax plans that have failed to pass in recent days, tore into his colleagues and vented his frustration.
“This whole situation is ridiculous. ... We’re standing here acting like children. Come on, people! We’re in a bind and we need to fix it,” he said, noting the looming furloughs for state workers.
Democrats accused Republicans of surrendering by passing an incomplete plan.
“You’ve wasted our time and our money,” said Sen. David Haley, D-Kansas City. He noted that the contentious floor debates began on Friday, when the Senate objected to Republican leaders’ plan to move into negotiations with the House before the Senate had developed its own position.
“I want each of you to think about what you’re going to tell the folks back home,” he said.
The Senate adjourned Tuesday before holding a vote on the overall bill. It is set to vote on it Wednesday morning. Bills require 21 votes to pass in the 40-member Senate, the same number that King’s amendment received.
After the vote on the King amendment, Sen. Marci Francisco, D-Lawrence, successfully offered an amendment to cut the sales tax rate on food from 6.15 percent to 5.7 percent starting in January.
The bill will retain several GOP-backed policy items that don’t significantly affect the state’s budget situation, including a $40,000 tax cut for Christmas tree farm owners.
Sen. Jacob LaTurner, R-Pittsburg, also successfully attached an amendment to require county and city governments to hold a public vote before taking in more property tax revenue.