AFP_KS2013LegAgenda_Report20011413.pdf

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2013 Kansas Legislative AgendaA New Beginning


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BUDGETKansas spending and debt have skyrocketed over the past 60 years.

Our state governments spending increased by 571% from 1960 to

2010 aer adjusting for ination. During the same time frame, stategovernment debt increased by 335%.

While increased population accounts for much of the need to increase

spending, it has by far outpaced the 31% increase in population during

the same time frame. From 1960 to 2010, per capita state governmentspending grew from $1,134 to $5,813 aer adjusting for ination. ats $5,813 for each man,

woman and child in Kansas.

Fortunately, Kansas legislators are becoming aware of the damage overspending has caused our

state and have hit reverse. Under Gov. Sam Brownbacks leadership, state expenditures have decreased

by $2.2 billion over the last two years, with the latest $14.3 billion budget having been approved in

June. Although these improvements should certainly be celebrated, Kansans should not mistake our

states spending problems as being solved. We must continue to hold our elected ocials accountableto a scally responsible rate of spending that is characteristic of any good government.

As if the cost of our state government isnt high enough, Kansans are also subject to the

burdensome taxes and spending of the federal government. Federal expenditures have increased by

409% from 1960 to 2010 aer adjusting for ination, and debt HAS INCREASED by an incredible532%. Like Topekas past spending addictions, these skyrocketing expenditures have dramatically

2013 Kansas Legislative AgendaA New Beginning


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outpaced the countrys 10% growth in population during the same time frame. From

1960 to 2010, per capita federal spending grew from $2,413 to $11,194 aer adjusting forination. Topekas and Washingtons spending costs every man, woman, and child $17,007a year.

Unfortunately, this skyrocketing spending is about to get much worse.

Federal taxes are expected to soar in 2013 thanks to the expiration ofmany tax relief measures and the implementation of the Presidents

health care law. Clearly if Kansas wants a competitive edge in the

global economy, both Topeka and Washington should lower taxes

and spending to attract greater commerce and thus greater prosperity.

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supports an 8% reduction in spending. Spending reductions should be

implemented in order to reconcile the projected budget shortfall while

also keeping adequate reserves in the state budget.

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population growth. e following excerpt from our FY 2011 Commonsense BudgetProposal, explains the impact spending constraints would have had if enacted in 2004. With

the expectation of signicant increases of revenues to the state government, this passageserves as a good reminder of what denes the path to prosperity:

a surplus of $340 million existed in FY 2004, but the growth in expenditures erased

that surplus and led to a shortfall of $890 million in FY 2010. If Kansas had instituted

a controlled spending approach as AFP advocated, the dierence would have beenpronounced for state governmentnances Instead of a decit of $890 million, Kansas

would have experienced a surplus of $554 million in state coers for FY 2010. It should

be noted this estimate is very likely well below what actually could be expected. With

just six years of spending controls the cumulative amount of funds that could have been

returned to taxpayers would have been in excess of $3.7 billion. is infusion of cash

into the economy would have generated additional tax revenues for the state coers while

strengthening Kansas private sector economy to weather the recession. It is obvious that

putting government growth and special interests ahead ofscal prudence has created a

problem that was easily avoidable. e question now is: will Kansas legislators ignore this

lesson of the past or move forward with self imposed spending controls?

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states transparency Web site with uniform budget reporting.

r3FRVJSFFWFSZTUBUFBHFODZUPJNQMFNFOU[FSPCBTFECVEHFUJOHQSBDUJDFT State agencies

should mirror a common practice amongst the private sector that is building their budgets

from scratch. At a minimum an agency should do it once every four years. It is dicult foranyone to make claim that all wasteful and inecient spending has been eliminated withoutbuilding a budget from the ground up.

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TAX POLICYOn May 22, 2012, Gov. Brownback signed HB 2117 into law, simplifying and

reducing our state tax codes burden. e reform collapses its three income taxbrackets into two and lowers their respective rates to 3.0% and 4.9%. A study by the

Kansas Policy Institute projects that somewhere between 33,430

and 41,690 additional private sector jobs will be created because ofthe tax reforms through 2018, and annual gross wages will increase

somewhere between $277 and $364.

is anticipated increase in economic activity is expected to broadenKansas tax base, as new residents and businesses set up shop in the

Sunower State. With such an increase in revenue, our state localgovernments will become less reliant on our high property, sales,

and corporate taxes making room for future rate reductions. As of

2009, these three taxes combined cost every man, woman, and child

in Kansas $2,533. In building on our states recent tax reform, AFPsupports more rate reductions in the future, thus assuring that Kansas continues down the path to

lower taxes and greater prosperity.

Additional tax agenda items:

r"'1TVQQPSUTBMFHJTMBUJWFTVQFSNBKPSJUZJOPSEFSUPSBJTFUBYFT Currently 16 states,

including three of our four neighboring states, require a super-majority to approve tax

increases.

r"'1TVQQPSUTUIF1SPQFSUZ5BY5SBOTQBSFODZ"DU is legislation will require propertytax mill levies to be automatically reduced in correspondence to increase in property

valuations. Local units of government that want to utilize their local taxing authority by

increasing property tax revenues can do so with a majority of the body approving it. For too

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long, local units of government have beneted from stealth-like tax increases due toproperty valuation increases. is legislation would provide government transparencyand accountability by requiring a vote for approving tax increases.

TAXPAYER-FUNDED LOBBYINGREFORMCurrently, more than 100 lobbyists with more than 60 government

entities/associations have been hired by your tax dollars, lobbying for

more and more of your money. Taxpayer funded lobbying propagates

the cycle of more spending and more programs that call for more

spending. Serious reform will help curb the culture of more is never

enough in Topeka.

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these services.

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JUDICIAL REFORMSupreme Court justices are selected primarily by an insider group of Kansas lawyers, and Kansas

is the only state with lawyers completely dominating the selection process. AFP supports reforms

that will open up the system, allow public input, and allow the appropriate questions to be asked

before a judge is appointed, rather than later.

ENERGY MANDATES AND GOVERNMENTASSISTANCE

ere is nothing wrong with investing in newer energy technologies like windmills. In fact, suchinvestment when done by private individuals and companies spur the free enterprise system that

drives prosperity. However when such investment is made by governments in the form of massive

subsidies, it unfairly takes money out of the wallets of private citizens and companies to wage as a bet

that some company will be protable. uite oen, as with Solyndra, it is not.

Kansas energy companies should stand on their own two feet without help from government.

Over the last few years, Kansas has developed the Kansas Renewable Portfolio Standards

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mandates in an eort to prop up alternative renewable energy sources. is is nothingbut government picking winners and losers and according to a July 2012 report

released by the Kansas Policy Institute and e Beacon Hill Institute, the losers areKansas taxpayers.

e July report e Economic Impact of the Kansas Renewable Portfolio

Standardconcludes that Kansas electricity ratepayers will pay higherrates and face fewer employment opportunities. e report states:

In 2020 renewable energy mandates will cost families an average of

$660 per year; commercial businesses will spend an extra $3,915 per

year; and industrial businesses will spend an extra $25,516 per year.

Between 2012 and 2020, the average residential consumer can expect

to pay $2,471 more for electricity. A commercial ratepayer would pay

$14,663 more during the period, and the typical industrial user would

pay $95,560 more.

Its easy to conclude these mandates will have an adverse eect on the Kansas economy. "'1supports theElectricity Freedom Actwhich would repeal the state standards.

OBAMACARE EXCHANGESOn principle, conservatives could support health insurance exchanges. ey harness the power

of free market competition, transparency and value comparison to drive innovation, increase choice,

and reduce costs. However, when a health plans participation in the exchange is conditioned on

page aer page of federal mandates and restrictions, exchanges can also be used as a tool to expandbureaucratic control and micromanage the market. ats exactly what President Obama and HHSSecretary Kathleen Sebelius are trying to do by inviting states to partner with the federal government

in creating Obamacare exchanges.

Fortunately Gov. Brownback has rejected the invitation from the federal government. However

attempts may be made during the 2013 legislative session to seek legislative approval to partner with

the federal government on this matter."'1XJMMPQQPTFBOZTUBUFFPSUUPDSFBUFUIF0CBNBDBSF

exchange in Kansas.

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REFER A FRIENDDo you have a friend that you would like to know about the work of AFP-Kansas? Send us their name and addressand we will send them a packet of information on AFP and how they can get involved. We will only do this once.If they chose not to get involved with AFP will discontinue communication with them.

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Documents

AFP_KS2013LegAgenda_Report20011413.pdf