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State set to tighten its belt

9/29/2012

By JOHN HANNA

By JOHN HANNA

Associated Press

TOPEKA -- Republican Gov. Sam Brownback's administration reported positive news Friday about the Kansas economy, but the governor also formed a task force to hunt for ways to make public schools more financially efficient and faced criticism from Democratic legislative leaders about potential budget cuts.

The Department of Revenue said the state's tax collections were $28 million more than anticipated, a 5 percent surplus that brightened the budget picture as the administration works on spending proposals to present to legislators.

September's boost wiped out a shortfall from August and left the state a little ahead for the fiscal year that began July 1.

The Department of Labor also weighed in on the overall economy, saying nonfarm employment rebounded in 2011 after two consecutive years of declines.

Employment continues to "edge upward" this year, the agency said.

Both reports belied recent statements from administration officials that the worsening national and global economy is cause for budgetary concern.

Also, their work on budget proposals is overshadowed by questions about whether massive income tax cuts Brownback signed into law this year will force agencies to tighten the belt even if, as promised, they stimulate the economy.

Against that backdrop, Brownback announced the appointment of a 10-member task force led by State Board of Education member Ken Willard, a Hutchinson Republican. The group includes Steve Anderson, the governor's budget director, and five other certified public accountants.

Brownback said he wants to ensure the state's school districts concentrate the bulk of spending on classrooms.

Democrats contend the income tax cuts -- worth $231 million during the current fiscal year and more than $4.5 billion over the next six years -- will force cuts in spending on schools, social services and other programs. Legislative researchers have projected that the cuts will lead to collective budget shortfalls approaching $2.5 billion during the next six years.

"A lot of critical state programs are being put on the chopping block," said House Minority Leader Paul Davis, a Lawrence Democrat, said during a Statehouse news conference. "Frankly, this is just the beginning."

Davis' news conference with Senate Minority Leader Anthony Hensley, a Topeka Democrat, came a little more than a week after the Department of Commerce recently announced it was ending its visible Main Street program. And in July, Anderson directed state agencies to prepare proposals to cut their spending up to 10 percent.

He and other administration officials also note that Anderson asked agencies to prepare proposals for current-resources budgets and outline recommendations for new spending. They contend Anderson's direction to agencies to propose cuts represents contingency planning and that the governor will protect core services.

Meanwhile, Brownback emphasized his goal with the task force is to ensure education funds are spent "as efficiently and effectively as possible."

The state's budget picture will become more clear in early November, when state officials, legislative researchers and university economists meet to issue a new, semi-annual financial forecast.

A forecast earlier this year had predicted that Kansas would collect $582 million in taxes in September, but the actual total was nearly $611 million. The state is about $16 million ahead this fiscal year, with tax collections of $1.5 billion.

But the current forecast doesn't account for the income tax cuts.