(Reuters) – A committee of Kansas lawmakers will be tasked with reconciling differences in legislation passed to plug a $ 280 million hole in the state’s 2017 fiscal budget after the Senate passed a revised version of a bill. approved by the House on Thursday night.
Both versions would allow the state to borrow money from a long-term mutual fund and delay a payment to the Kansas Public Employees Retirement System. But monetary amounts and plans to repay the cash differ, JG Scott, deputy director of fiscal affairs for the Kansas Department of Legislative Research, said Friday.
Tax cuts enacted in 2012 have blown a hole in Kansas’ budget as revenues fell short of monthly estimates, although February marked the fourth consecutive month that collections met or exceeded projections.
Kansas also faces spending on higher education in the wake of a recent state supreme court ruling.
Scott said the bills to fix the budget will go to a committee of the legislative conference probably next week.
On Thursday, the Senate rejected three attempts to amend the bill with overall spending cuts of 2 percent, 1 percent and 0.5 percent.
Republican Senate Speaker Susan Wagle argued that the spending cuts, which would have included public elementary and secondary schools, would ease the tax increases the legislature is expected to take to address a projected $ 755 million budget deficit over the next few years. two fiscal years.
A measure in the state legislature last month to increase revenue by raising tax rates and removing a business exemption failed when the Senate failed to override Republican Gov. Sam Brownback’s veto.
A March 2 state supreme court decision complicates Kansas finances that found the school funding system does not meet a constitutional adequacy requirement. The ruling, which set a June 30 deadline for enactment of a constitutional funding method, could require Kansas to increase school funding by more than $ 500 million each year.
Moody’s Investors Service and S&P Global Ratings have said the ruling will put more pressure on the state’s already shaky finances.
Meanwhile, there are pending resolutions in the House and Senate to put a constitutional amendment on the November 2018 ballot that would require a two-thirds vote of both houses of the legislature to pass any state tax increases. The measure also seeks an annual cap on state spending and make money for debt payments and budgetary reserve.
Scott said that previous attempts to put similar measures on the ballot were unsuccessful.
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