House says its budget will not raise taxes

TOPEKA — A key Kansas House Republican said Thursday his budget committee will produce a 2011 budget that will end in the black without raising taxes.

Despite a downward revision of Kansas' revenue estimates last week by researchers, the blueprint the House Appropriations Committee has sketched out will still work, said Rep. Kevin Yoder, R-Overland Park. Subcommittees met Thursday to consider additional changes and will assemble a final bill today.

"I won't be surprised if we added some money in, but it won't require a tax increase," said Yoder.

In its latest consensus revenue report, a group of Kansas economists and researchers projected that the state will end the current fiscal year with an $89 million shortfall. That figure balloons in the fiscal year beginning July 1 to $510 million under a budget proposal by Democratic Gov. Mark Parkinson.

Under the tentative House plan, Kansas would end 2011 with a surplus of $159 million, but that would shrink to $75 million when factoring in the 2010 shortfall. Yoder doesn't want to spend all that reserve and would prefer to find more savings.

"Zero is not OK," he said.

Senators finished work Wednesday on their own 2011 budget plan, which would require $412 million in new revenue to balance. The figure grows to $501 million to cover 2010's deficit.

All 125 House and 40 Senate members return to work Wednesday to resume the session after a nearly monthlong break. They will have 15 days remaining of the 90 days scheduled for the 2010 session, but they could go longer if necessary.

The House plan cuts state spending, including not replacing federal stimulus funds used in the current year for K-12 education. It also assumes Kansas will get some $130 million in federal Medicaid funds.

Alan Conroy, head of the Legislative Research Department, told the House committee that the state's economic recovery was "anemic" and that Kansas could expect to see unemployment around 6.7 percent for 2010 and 2011.

In calendar year 2009, Kansas experienced the first decline in personal income since World War II, he said. Incomes contracted by 0.4 percent but are expected to rebound by 1.8 percent in 2010 and 2 percent in 2011. Individual income taxes are the single largest source of state revenue.

"It emphasizes the severity and difficulty that the state finds itself," Conroy said.

Legislators are likely to push most of the shortfall to the 2011 budget by delaying payment of some bills, such as pushing the final school aid payment from June to July, which it has done in the past. They also could use some leftover federal stimulus money that was intended for the next year or transfer money from any other available state accounts.

Yoder said there was too little time between when a bill cutting state spending would be approved and signed by Parkinson and the end of the fiscal year to make up the shortfall.