Gov. Laura Kelly was joined by area legislators for a town hall meeting in Hays Monday night, and while she and the three Republicans disagreed on Medicaid expansion and taxes, they did find common ground on other topics including the Kansas Employees Retirement System and rural development.
Kelly will be at a community engagement session on early childhood care and education at 10 a.m. Tuesday in the Memorial Union at Fort Hays State University.
Watch HDNews.net for more on Kelly’s visit to Hays. Here are some highlights of the Monday town hall meeting at Sternberg Museum of Natural History:
Gov. Kelly’s veto of tax bill
In answering a question to sum up the 2019 legislative session, Sen. Rick Billinger, R-Goodland, criticized Kelly for her veto of a bill that would have decoupled the state from federal tax changes. Senate Bill 22 would have allowed individuals to itemize deductions on their state taxes even if they didn’t on their federal taxes. It would also have allowed multinational corporations to bring profits earned overseas back to Kansas without paying income tax and decreased the sales tax on food.
“Until the tax change at the federal level, these corporations never, never paid income tax in Kansas. Until we decouple, they’re going to have to pay. Kansas is one of only seven states left to decouple,” he said.
Billinger said Kelly’s veto a tax raise on individuals.
“I see where revenue today is way up, probably $300 million,” Billinger said, referring to the Department of Revenue’s report Monday the state collected $77 million more in taxes than expected in May.
“I’m guessing this tax increase is probably, I guess it’s over a quarter of a million dollars,” he said.
“I’m also disappointed we didn’t get a reduced food sales tax,” he said.
Kelly did not directly address Billinger when she offered her summary of the legislative session but did speak about taxes.
“I’ve said all along, we don’t know the impact, we don’t know the bottom line on what we did in Kansas when we reversed the Brownback tax experiment in 2017, and we don’t really understand the full impact of the federal changes made in 2018. We will know that in October or so. It is at that time that we should be looking at our overall tax structure and present a plan for a systematic approach to taxes that will take us back to what worked for Kansas,” she said.
She referred to Gov. Bill Graves’ tax metaphor of a three-legged stool and balancing property, sales, and income tax.
“We are way out of whack right now. Property taxes are ridiculously high, as are sales tax on food. We will bring together experts in this area, and we’re going to plot out a plan. It’s not something we can achieve in one year, but we will lay out a long-term plan to move us back towards that structure that worked in Kansas for a very long time,” she said.
When asked if Kansas farmers should be worried about recent federal tariff announcements, Kelly’s initial answer was simply, “Yes.”
She went on to say that if there were a strategy behind the tariffs, she would be more comfortable with them.
“But I know there is not a strategy. So all we’ve got are these tariffs imposed on other countries … and what it’s doing here is filling up our silos,” she said.
“And it’s not just for now, you know, but as we cut off those markets, that’s very difficult to put back. So we talk about tariff and trade, we’re talking about long-term implications that can be devastating to our economy, our agricultural economy and our manufacturing economy,” she said.
Billinger said while most people do not like tariffs, it’s time to deal with China.
“When we have the type of issues we have with China stealing everything, I mean all of our technology … at some point in time, you have to put your foot down and say enough’s enough,” he said.
Rep. Ken Rahjes, R-Agra, said the country isn’t accustomed to President Donald Trump’s methods.
“What I believe is if you go back and look at this president before he was president, he’s a negotiator. You go back and read ‘The Art of the Deal’ or anything else, like it or not, you go back and it’s true,” Rahjes said.
Several people in the audience laughed in response.
“My point is this. That’s the way he makes a deal. It’s just something we’re not used to. Where does this take us? We don’t know. We all think we know. We don’t,” he said.
In response to a question on what will happen with Medicaid expansion and how the legislators would vote on it, Rep. Barb Wasinger, R-Hays, said she didn’t vote for it this session because she believed it would be expensive for the state
She, Billinger and Rahjes said they believed there would be an effort to get it passed next year, Rahjes noting an election year might encourage more cooperation, but they would have to see the bill to be able to say if they would vote for it.
“One of the ideas that I think we need to look at, I don’t know if it would work or not, but I think we need to look at enhanced reimbursements for smaller hospitals. We truly want to help small hospitals. Let’s look at enhanced reimbursements. I think there’s a lot of things like this that we need to discuss that maybe would make a good plan,” he said.
Kelly noted the Medicaid expansion bill that passed in the House of Representatives but failed by one vote in the Senate was modeled after a bill that passed both chambers in 2017 but was vetoed by then-Gov. Sam Brownback.
Kelly said Kansas can look to states that have passed Medicaid expansion to learn about the costs and benefits.
“The only good news about the fact that we have not expanded Medicaid is that we now have real-time results from other states who did,” Kelly said.
“Montana, Louisiana, Indiana, others have seen it — and these are pretty red states — others have seen that it is an eco-devo driver. Not only are folks getting access to healthcare, the feds are reimbursing the state. It’ll be 90 percent by the time we get that done,” she said.
“The numbers work. Louisiana, in the first year they expanded Medicaid, they saw a $317 million cost savings. They created 19,000 new jobs. So it’s good for the state. It’s good for the economy, and obviously it’s the good and right thing to do for the people,” Kelly said, getting applause from the audience.