Medicaid Expansion Fails
Last year at this time, most legislative observers would have told you that passing a Medicaid Expansion bill in both the House and the Senate was about as likely as Gonzaga playing for a national title. And yet that is exactly what has happened. The bill called Bridge to a Healthy Kansas was vetoed by the Governor but on Monday, following a bruising weekend of phone calls, e-mails and bare-knuckled lobbying, the House debated whether to override his veto.
Those not inclined to favor Medicaid Expansion have expressed deep concerns over the fiscal ramifications of expanding an entitlement program in the midst of one the most persistent and, as yet, unresolved budget crises in recent memory. They point to uncertainty in Washington DC as justification for their reluctance to take on coverage of 150,000 Kansans without being sure where the money to pay for their coverage will come from. Advocates of expansion, including the Chamber, have pointed out that Obamacare remains the law of the land and the federal government is obligated to reimburse states 90% of their costs of expansion They also argue an expanded Medicaid program will ultimately produce savings in excess of the new costs as Kansans who previously only encountered the medical system at its most expensive point, the emergency room, will begin seeking routine medical care once they know they are covered and will be in a much better position to address issues early on before they became acute, and expensive, medical emergencies.
By noon on Monday, the Medicaid Expansion bill was dead: 81 House members cast their Aye vote to override the veto but they needed 84. The Chamber appreciates the courage and leadership shown by those members of the Shawnee County delegation who voted in favor of overriding the veto: John Alcala, Brenda Dietrich, Jim Gartner, Annie Kuether, Vic Miller, Fred Patton and Virgil Weigel.
Paying this Year’s Bills
The House and Senate have finalized negotiations of a spending bill for the remainder of this fiscal year. The compromise package should be voted into law this week. Lawmakers found most of the aprx. $280 million needed to close out the books this year by borrowing against the state’s so-called idle funds and delaying payments to KPERS. No one considers these measures to be sound long-term solutions but they seem to get the job done for this fiscal year and inflict relatively little pain on state agencies or the Kansans they serve.
Planning for Next Year’s Bills
The Senate last week passed its version of a budget bill for the next two fiscal years. It is admittedly incomplete because it says nothing about school funding and it is premised on the state raising roughly $400 million in new revenues in each year. The House’s budget bill is headed to the floor for debate this week. Both chambers understand a truly final budget won’t be possible until May when legislators come back for the so-called “Veto Session.” By then a new school formula and, presumably, a veto-proof plan for raising taxes will have been put together. At that point, it will be possible to sew all the components of a balanced budget into one Omnibus spending bill.
Taxes
Legislators on both sides of the Statehouse are essentially waiting for the Senate Assessment and Taxation committee to hammer out its tax plan and send it to the floor of the Senate this week. Earlier in the session, the House had taken the lead on taxes but its package was vetoed. The House Tax Committee did pass out a bill last week which would do away with all income tax brackets and simply impose a flat 5% tax no matter how much the individual taxpayer earns. The bill does some other things, including repeal the LLC exemption, but even the members of the committee do not seem all that fond of their work product. This bill seems to have been a way for the House to keep the discussion going on tax policy until the Senate produces its tax bill.
Entertainment Districts
The House passed the bill which gives cities the right to designate certain areas where adults could stroll down the sidewalk with a beer or wine in their hands. The legislation allowing for the creation of “common consumption areas” could give Topeka a new tool to help continue the revitalization of areas such as NOTO and Downtown Topeka. The goal this week is to persuade Senate leaders to quickly take up the bill and get it passed before the final buzzer on April 7.
Economic Development
The Topeka Chamber, along with many others across the state, had been watching wearily as bills were introduced in the Senate to eliminate or drastically reduce the scope of the important jobs incentive programs called HPIP and PEAK. The Chamber testified against the legislation. As none of those bills has made progress in committee, supporters of those programs are cautiously optimistic the bills will not move forward to passage this session. More likely the legislature will ask that the effectiveness of these programs be studied this summer. That is when economic developers in Kansas will need to make their case. That being said, vigilance will be required to ensure these concepts are not revived in the dark hours of the final days of the session.
School Funding
The House K-12 Education Budget Committee worked late into the night last week trying to put the finishing touches on its new school finance formula. The details and the impact of the formula on school districts remain obscure at this point except that the new formula apparently bears a resemblance to the old one. It would result in some school districts receiving less from the state than they were under the current block grant system and many receiving more. Whatever the details, the point is that the House formula is being built methodically by legislators who understand school finance. Some would note that is a marked distinction from the unnuanced system of block grants which the legislature hurriedly put in place two years ago after it had scrapped the old formula.