Gov. Sam Brownback’s administration on Wednesday proposed steps to generate about $116 million during the next fiscal year and reduce spending by about $105 million in response to a budget shortfall.

Lawmakers questioned the revenue estimating process, which has proven too optimistic over nearly two years on how much cash would flow into state coffers.

State Budget Director Shawn Sullivan told lawmakers the administration plans to transfer an additional $25 million from the Kansas Department of Transportation for the next fiscal year, which begins July 1.

Additionally, about $50 million from the Children’s Initiative Fund will be transferred into the state general fund, though Sullivan said the spending fueled by the CIF will be unaffected.

Sullivan presented the budget to a joint meeting of the House Appropriations and Senate Ways and Means Committee. The proposal comes as the state currently faces a $19 million shortfall for the current year and at least $175 million next fiscal year.

For the current fiscal year, Sullivan proposed about $24 million in additional transfers to help keep the budget balanced.

“We’re holding the line on expenditures and trying not to grow the government,” Sullivan said.

Sullivan dismissed the criticism of previous budget directors, child advocates, the Kansas Contractors Association and the media.

For the current fiscal year, Sullivan proposed about $24 million in additional transfers to help keep the budget balanced.

The budget proposal includes a number of changes. Among them:

n$25 million in savings from privatizing the Kansas Bioscience Authority

n$50 million in savings from Medicaid reforms

n$25 million in savings from reducing children’s health insurance spending by relying on increased federal grant money

“We can’t (balance the budget) through our ending balance, so we are really, I think, grasping at straws to provide monies that we clearly need,” Sen. Marci Francisco, D-Lawrence, said. “We are not addressing many of the shortfalls we are hearing exist.”

The budget recommendations don’t speak to staffing levels at the Kansas Highway Patrol, Francisco said.

The number of troopers has declined from 501 in 2006 to 419.

The state has been in a period of decreasing revenue forecasts for more than a year. The Legislature passed and Brownback in June signed a massive revenue package that increased taxes to raise $400 million. But revenue has continued to underperform estimates.

The continued missed estimates prompted lawmakers to question the consensus revenue estimating process. Sen. Jeff Melcher, R-Leawood, suggested the budget proposal wouldn’t be enough to balance the budget. A new revenue forecast will be issued in April, and some lawmakers anticipate the forecast will once again be decreased.

“I kind of look at this budget as a Plan B in the event that everything works out well,” Melcher said, “but it appears we’re going to need to have a Plan A, which is based on the history of what we see and anticipating that history is not going to change dramatically. Hopefully it does.”

On Tuesday, the consulting firm Alvarez & Marsal provided lawmakers with an efficiency report with recommendations to save the state $2 billion over 5 years. Sullivan acknowledged the report and indicated he was moving forward in one area brought to light by the consultants — staffing at the Department of Revenue.

The report called for the agency to fill more than 50 revenue officer positions and more than a dozen auditor spots in an effort to collect additional tax revenue.

Sullivan said he had given the green light to the agency to hire some additional personnel.

Rep. Jerry Lunn, R-Overland Park, wondered whether outsourcing the positions had been considered.

“I know those organizations, many of them will use a percentage of collections to collect their money, so if we did that they’re highly-motivated to be successful in their collections,” Lunn said.

The recommendations also call for savings in Medicaid spending through implementing a process known as step therapy. Under step therapy, doctors attempt to use lower-cost drugs — such as generics — first, before using costlier, name-brand medications.

Sullivan projects about $10.6 million in savings from the change, though the Legislature must act before step therapy can be put in place.