Kansas Legislature Overrides Brownback Veto: Raises Taxes, Passes New School Funding Formula

Ehrenfreund reminds us that Brownback called his tax reform, “a ‘real-live experiment’ in conservative governance. Yet the economic boom Brownback promised has not materialized, leaving the state government perennially short on money and forced to reduce basic services.” “Last year, Kansas’s gross domestic product increased just 0.2 percent, federal data show, compared to 1.6 percent nationally. That was an improvement for Kansas, though: At the end of 2015, the state was in what many economists would describe as a recession, with the economy contracting two quarters in a row.”

Brownback, however, remains unrepentant. In a late report John Hanna, covered Brownback’s news conference following the legislature’s override of his veto: “Republican Gov. Sam Brownback says the income tax increases legislators enacted over his veto will be bad for the long term health of the state’s economy. The governor said during a news conference Wednesday that he believes the increases will slow job growth and discourage companies from moving to Kansas.”

Nick Johnson, the senior vice president for state fiscal policy at the Center on Budget and Policy Priorities, disagrees with Brownback: “Governor Brownback promised the tax cuts would be a ‘shot of adrenaline into the heart of the Kansas economy,’ but reality has been far different. Rather than spur a boom, the Brownback plan merely gave a tax-cut windfall to the rich and raised taxes on many lower income people while sending the state’s finances into a tailspin. Kansas’ finances are now in crisis. State reserves are drained, and Kansas faces a $900 million budget shortfall. Two bond rating agencies have downgraded Kansas due to its fiscal problems, and the state’s education system and other crucial services have suffered as the state struggled to afford to invest in people and communities. Kansas’ five year experiment shows us what happens when we try to tax-cut our way to prosperity.”

I guess the members of the Kansas legislature noticed, and finally did something to begin correcting the problem.

janresseger | June 9, 2017

janresseger

Something stunning happened on Tuesday night in Topeka.  John Hanna of the Associated Press reports: “Kansas legislators Tuesday night repudiated the tax-cutting experiment that brought Gov. Sam Brownback national attention, with even fellow Republicans voting to override his veto of a plan reversing many of the income tax reductions he’s championed…. The state will increase its personal income tax rates and end an exemption for more than 330,000 farmers and business owners. Legislators expect the changes to raise $1.2 billion in new revenue over two years to close projected budget shortfalls totaling $889 million through June 2019…. Under the new tax laws, Kansas will return to having a third income tax rate for its wealthiest filers, something cuts in 2012 eliminated. The top rate will be 5.7 percent, as opposed to 4.6 percent now.”

Even before passing the tax hikes—in the wee hours of Tuesday morning—the Kansas legislature…

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