House budget offer would delay pension payment, safeguard education funding

The House budget chairman offered a partial solution to the state’s projected shortfall late Friday.

Rep. Ron Ryckman, R-Olathe, proposed delaying a $100 million payment into the state’s pension fund indefinitely to improve the state’s cash flow.

Gov. Sam Brownback’s office announced it would delay the payment earlier this month. But under current law, he must pay it back by September. Ryckman’s proposal gives the state more leeway.

It would also designate two sources of revenue to help pay back the money with 8 percent interest.

If the state beats revenue estimates next year, that money would go into the pension system first.

Money from the state’s tobacco settlement would also be used if the annual payment exceeds the amount already earmarked for children’s programs next year.

Current retirees’ benefits would not be affected by the delay, officials have said. But the Kansas Organization of State Employees has warned that delaying money could hinder the state from paying off the pension system’s $9 billion unfunded liability in the long term.

Budget cuts would still be needed to fill in the state’s $290 million budget hole even if the pension payment is delayed. But Ryckman also proposed including a proviso to shield K-12 education from any future cuts.

Ryckman said the governor has always had the power to enact additional budget cuts. “We just took K-12 off that list,” he said.

Mark Tallman, spokesman for the Kansas Association of School Boards, said the proviso would give school districts a higher level of assurance about their funding for next year.

Ryckman also offered a proviso to enact live-streaming at the Capitol next year with grant money, something supporters say would increase transparency at the Legislature.

Negotiators from the House and Senate will meet again Saturday morning. The Senate could accept Ryckman’s offer or make a counterproposal.

Sen. Ty Masterson, R-Andover, the Senate budget chairman, said he needed to look over the language before deciding whether he would accept the proposal.

This story was originally published April 29, 2016 at 9:59 PM with the headline "House budget offer would delay pension payment, safeguard education funding."