Kansas will have difficulty paying its bills if lawmakers do not pass a measure to fix a $279 million budget shortfall by mid-February.
Shawn Sullivan, the governor’s budget director, said the Republican-dominated Legislature should pass a bill by Feb. 13 to ensure that the state can keep paying its bills on time.
Gov. Sam Brownback released a plan in December to close the shortfall through a combination of cuts and transfers from the state’s highway fund and other sources into the general fund.
More than $200 million of the changes require legislative approval.
The nonpartisan Legislative Research Department previously said the state would be unable to pay some of its bills by mid-February.
Sullivan couched his reply when asked if the state would begin bouncing checks next month.
“In mid-February, cash flow gets tight. We can write checks,” he said. “We have school payments going out of $45 million on Feb. 17. We’ve got another $129 million that goes out in late February, so our ability to pay all of those becomes impacted if we don’t have this rescission bill by then.”
The state’s cash balances ebb and flow as it collects tax revenue and spends money on services. The state approved borrowing $675 million in June to help fill coffers at times when cash flow is low. It cannot do that again unless it is able to pay that money back, as required by statute.
The House Appropriations Committee began hearings Wednesday on budget-balancing measures, and Chairman Ron Ryckman Jr. said he expects it to pass a bill by Monday, so that the full House can debate it next week.
“We are up against it,” Ryckman, R-Olathe, said.
The state faces not only a projected shortfall in its current budget, but a $436 million gap between anticipated revenues and current spending commitments for the fiscal year beginning July 1. The shortfalls arose after lawmakers, at Brownback’s urging, aggressively cut personal income taxes in 2012 and 2013 to stimulate the economy.
In the past, Kansas has delayed monthly aid payments to public schools and other bills when budget problems have caused cash crunches. But Sullivan said if a budget-balancing plan passes quickly the state should be fine through June,
“We’ll work it out,” said Sen. Jeff Melcher, R-Leawood, when asked if lawmakers would pass the needed bill by mid-February. “We’re not going to ever let a check bounce. Whether it’s going to be exactly as it is (as proposed by the governor) I don’t know, but we’ll work to meet the deadline on that. I have no concerns about us honoring our responsibility.”
Sen. Ty Masterson, R-Andover, chair of the Ways and Means Committee, also was confident that the Senate would be able to pass a bill on time. He said the House presents more of a challenge.
“I’m highly confident that we will make it through the process. The only caveat to that is if there’s members of the House who will try to thwart the process for political reasons,” Masterson said. “The House is a little less predictable. … Sub-factions are more common over there and that would be the only reason to slow it.”
Rep. Scott Schwab, R-Olathe, who has been in the Legislature for 13 years, said lawmakers have been in similar situations under previous governors and have always managed to pass a bill in time.
“It’s not as big of a deal as it looks,” Schwab said. “It’ll probably be a bipartisan effort if folks start coming up short. … They (Democrats) will help us get it passed if we need to, because they understand this.”
He said it was amazing what can be accomplished in a short amount of time when something needs to be done.
Brownback has blamed much of the shortfall on unanticipated education costs connected to the aid for poor public school districts after the Kansas Supreme Court mandated increases in a lawsuit filed in 2010 by parents and school districts.
The governor is sticking by an earlier proposal to cover the extra costs, setting total school aid at $3.7 billion under the current budget, then drop it to $3.6 billion for the next fiscal year. He’s also proposing that lawmakers repeal the existing formula for distributing aid and write a new one.
Rep. Jerry Lunn, R-Overland Park, a House Appropriations Committee member, said forgoing the additional funds in the current budget should be an option.
“When we put this thing together last year, we didn’t realize that we were going to have that $64 million hit,” Lunn said.
But Rep. Jerry Henry, of Atchison, the Appropriations Committee’s ranking Democrat, said it’s problematic not to cover the unanticipated costs because lawmakers were responding to a court order.
Contributing: Associated Press