Session, tax plan a mess

The most conservative Legislature the state has ever seen just passed the largest tax hike the state has ever seen. It also took a record-breaking 113 days to do 90 days’ worth of business and necessitated an overtime tab of nearly $1 million.

If all that sounds nuts, so did Gov. Sam Brownback’s congratulatory statement to lawmakers just moments after the Senate approved the tax bill on Friday afternoon. He talked about “coming together in a spirit of cooperation and compromise to do what is right for Kansas” and keeping “the state on a path of economic growth.”

It was as if he’d slept through the past few weeks – which he could have, judging from his visibility during much of the bitter showdown between the chambers.

One of the biggest problems with the final deal is exemplified by a concept missing from the governor’s statement: fairness.

State leaders faced a $400 million-plus budget hole created by the 2012 tax bill, which cut income tax rates overall but also zeroed out taxes for what turned out to be more than 330,000 business owners and farmers. Kansas has $1 billion less revenue this year than it would have if not for those tax cuts.

For a moment earlier this spring it seemed leaders might remedy what even Senate President Susan Wagle, R-Wichita, had characterized as the “unfair tax treatment” that was an “unintentional consequence” of the 2012 law, by closing the loophole allowing some business owners to pay no income tax.

Instead, Brownback threatened to veto any such fix. He and lawmakers are turning to all taxpayers to fill the gap through a higher sales tax – a regressive offense compounded by the failure of the final package to reduce Kansas’ second-highest-in-the-nation taxation of food. A rebate will help only a few food buyers.

The move from a statewide sales tax rate of 6.15 to 6.5 percent will come just two years after lawmakers nixed Brownback’s proposed continuation of a 6.3 percent rate, and five years after then-candidate Brownback criticized what was supposed to be the temporary sales tax increase from 5.3 to 6.3 percent.

So, apparently, sales taxes magically smell sweeter when you call them “consumption taxes” and you say people have an “option” to pay them.

The struggle to get to adjournment saw many “last” chances and new lows, and scary threats of mass furloughs and drastic spending cuts. Each proposal seemed to get longer and more complex, with some voting going on before the bills could be accessed, let alone read. One House vote came at 4 a.m. – which is no time to be making law – another with zero debate.

And rather than mind their own business of mixing up a brew of higher taxes at the state level, legislators added a confusing and unexamined provision to make it tougher for cities and counties to access the property tax revenue needed to fund services.

Serious doubts remain about whether the final budget and tax package will cover the state’s obligations, let alone provide a $36 million ending balance next year, or whether more cuts will be coming to state-funded services. The prospect of a court order to boost K-12 funding still looms large.

The admittedly arduous process brought a number of leaders to tears, the governor included. But the real mourning started in 2012, when Kansas abandoned a balanced approach to taxation that had served it well for many decades.

For the editorial board, Rhonda Holman

This story was originally published June 13, 2015 at 7:06 PM with the headline "Session, tax plan a mess."