TOPEKA — The House on Tuesday gutted — then delayed a vote on — a bill that had sought to eliminate sales tax exemptions on home utilities, churches, lottery tickets and a host of odds and ends.
The bill had targeted about $170 million in sales tax exemptions.
House Bill 2549 now targets only coin-operated laundry services. Eliminating that sales tax exemption would generate an estimated $380,000 in 2010.
Eliminating sales tax on utilities, by comparison, would have captured almost $140 million for the state.
Rep. Jeff King, R-Independence, vice chairman of the House Taxation Committee, called a state sales tax on utilities "regressive," saying it would increase Kansans' bills by 5.3 percent.
Democrats decried the changes, calling the debate politicking. They and moderate Republicans pushed successfully to postpone a vote on the bill until May 3, during the wrap-up session, three weeks after a new revenue estimate for fiscal 2011 is released.
Taxes shouldn't be debated until lawmakers know what the budget proposals look like, they contended. The delay was approved 64-57.
"Today was bad politics," said Assistant House Minority Leader Rep. Jim Ward, D-Wichita, afterward. "It was gotcha politics to try to catch people voting against churches and for raising the cost of utilities for Kansans."
Rep. Aaron Jack, R-Andover, argued against delaying a decision on the bill.
"We have to attack it and get in there and try to make good decisions so the checkbook balances," he said.
Lawmakers are staring at a $400 million-plus budget gap for the 2011 fiscal year, which starts July 1.
The House Appropriations Committee has not presented its budget proposal for 2011. Last Friday the Senate Ways and Means Committee moved its proposal — which relies less on cuts than the House version is expected to — to the full Senate.
"It is way too early to be asking this body to decide on a tax package when we don't know the size of the budget hole," said Rep. Nile Dillmore, D-Wichita, who proposed the delay.
Later this week, the Senate Assessment and Taxation Committee is expected to debate a revenue package that would increase taxes on soft drinks, alcohol, tobacco and cigarettes as well as the state sales tax.
While the debate in the House wound on, several hundred school supporters held a rally outside the Statehouse urging lawmakers not to make further cuts to education.
Gov. Mark Parkinson, a Democrat, told the crowd that the decision whether to cut more or increase revenue would decide Kansas' character going forward.
"Will we be a state that tears down its schools ... do we want to be a state where only the wealthy can get a quality education?" he asked.
"This year the question is very specific: Will you raise taxes to save our schools?" he told the crowd.
Democrats and many moderate Republicans contend the state budget cannot withstand more significant cuts without irreparable harm. At the same time, leaders in the more conservative House have pushed for deeper cuts and are adamant that increased taxes are not the answer.
"There are two ways we can govern this budget. Republicans say what is the revenue and we build the budget around that," said Rep. Scott Schwab, R-Olathe. "Democrats say what is the budget and build the revenue around the budget."
After the debate, House Speaker Mike O'Neal, R-Hutchinson, said the delay was just an attempt by Democrats to build more support for tax increases.
"Stifling this tax debate suggests that Democrats hope to see a Senate budget come over that leaves the state with a shortfall of over $300 million," he said in a written statement. "This deficit would create the excuse these legislators are looking for to raise taxes on Kansas families already struggling in the recession."
The debate Tuesday was an important part of the process to determine what money is available to spend, said House Majority Leader Ray Merrick, R-Stilwell.
"This is indicative of the larger problem that these members fail to grasp. The state does not have a revenue problem. We have a spending problem," he said in a statement.
The Kansas Chamber weighed in on the tax issue Monday, issuing a release that praised Missouri Gov. Jay Nixon, a Democrat, for proposing a "fiscally responsible" plan to fill that state's $500 million budget gap without raising taxes.
The chamber opposes Parkinson's budget proposal, which includes a three-year, 1-cent increase to the state sales tax, saying increased taxes would "negatively affect" the state's ability to recover from the recession and to compete with surrounding states.
Parkinson, who also had used the rally to push the sales tax increase, noted later that he has cut more from the budget than any other governor in the state's history.
"So, if I'm addicted to spending, I'm doing a pretty terrible job at feeding my habit," he said.