From the House of Representatives - Revenue shortfall not improving

By Mitch Holmes, Kansas State Representative
Posted Mar 02, 2010 @ 10:52 AM
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Last week was a fairly slow week after working through more than 50 bills the previous week.

The major policy issue was HB 2221, a statewide smoking ban. Unfortunately, members never had the opportunity to make any changes to the bill through a debate on the House floor.

The vote that was taken was to concur with the Senate's changes to a house bill. My major objection to the bill was the exemption provided for casinos, and the requirement that ALL businesses must go the the expense to create a no-smoking policy that duplicates the state's policy. If the State is to impose a policy, there is no reason to have businesses create a separate policy that matches a state-wide restriction. Following is my explanation of vote as recorded in the House Journal for Feb 25, 2010:

"MR. SPEAKER: Regardless of how one feels about a smoking ban, I have trouble with the double standard presented in this bill. If and when a trailer bill comes forth that cleans up the glaring problems in this bill, I will gladly support such a trailer bill. Until then, I must oppose this bill as seriously flawed. I vote NO an concurring with HB 2221 without the ability to amend.- MITCH HOLMES"

Friday we received more bad news about the Kansas economy. Since Friday, we've received the official number, which is worse than believed at the time we got the news. Below is a direct quote from one of the state's fiscal analysts on Thursday:

"For the month of February there is only one processing day left - Friday, February 26, 2010.  It should be noted that the 25th of the month is the due date for a large number of tax payers who are paying sales and compensating use taxes.  So, tomorrow should be a big deposit day for those  sources. 

Also, it appears that individual income tax payers are filing for refunds at a much higher rate through February of this year as compared to February of last year.  The number of electronic filers is up considerably.  Perhaps people needing their refunds quicker, the delay in paying refunds last year, the encouragement by the Department of Revenue to file electronically - all might be helping to drive actual collections below the estimate because refunds are higher than anticipated for February.

All that said, the guess right now for State General Fund tax receipts only for February will be a shortfall of something in the $60 to $70 million range.  That would be on top of the $39 million we were short through the end of January.  Continued weakness in individual income tax receipts remains the major problem.  It appears that individual income tax withholding (taxes paid by salaried individuals) for February might end up considerably below February, 2009.  Tomorrow we will have the tax receipts only number for February and then next week, once Accounts and Reports closes the February books, we will have a final number." End quote. Since then, the real number has been calculated to be $71 million below expected revenues.

Also this week we had a lighter subject to address. The House Federal and State Affairs committee advanced a bill to name Little Bluestem as the official state grass. The bill was the result of the work of Kansas schoolchildren who presented testimony in committee. It was one of the more enjoyable committee meetings so far this year. I wish I had more good news to share with all of you.

Mitch Holmes ini the Kansas State Representative for the Kansas House District 114.  His email is campaign@mitchholmes.com
 

Last week was a fairly slow week after working through more than 50 bills the previous week.

The major policy issue was HB 2221, a statewide smoking ban. Unfortunately, members never had the opportunity to make any changes to the bill through a debate on the House floor.

The vote that was taken was to concur with the Senate's changes to a house bill. My major objection to the bill was the exemption provided for casinos, and the requirement that ALL businesses must go the the expense to create a no-smoking policy that duplicates the state's policy. If the State is to impose a policy, there is no reason to have businesses create a separate policy that matches a state-wide restriction. Following is my explanation of vote as recorded in the House Journal for Feb 25, 2010:

"MR. SPEAKER: Regardless of how one feels about a smoking ban, I have trouble with the double standard presented in this bill. If and when a trailer bill comes forth that cleans up the glaring problems in this bill, I will gladly support such a trailer bill. Until then, I must oppose this bill as seriously flawed. I vote NO an concurring with HB 2221 without the ability to amend.- MITCH HOLMES"

Friday we received more bad news about the Kansas economy. Since Friday, we've received the official number, which is worse than believed at the time we got the news. Below is a direct quote from one of the state's fiscal analysts on Thursday:

"For the month of February there is only one processing day left - Friday, February 26, 2010.  It should be noted that the 25th of the month is the due date for a large number of tax payers who are paying sales and compensating use taxes.  So, tomorrow should be a big deposit day for those  sources. 

Also, it appears that individual income tax payers are filing for refunds at a much higher rate through February of this year as compared to February of last year.  The number of electronic filers is up considerably.  Perhaps people needing their refunds quicker, the delay in paying refunds last year, the encouragement by the Department of Revenue to file electronically - all might be helping to drive actual collections below the estimate because refunds are higher than anticipated for February.

All that said, the guess right now for State General Fund tax receipts only for February will be a shortfall of something in the $60 to $70 million range.  That would be on top of the $39 million we were short through the end of January.  Continued weakness in individual income tax receipts remains the major problem.  It appears that individual income tax withholding (taxes paid by salaried individuals) for February might end up considerably below February, 2009.  Tomorrow we will have the tax receipts only number for February and then next week, once Accounts and Reports closes the February books, we will have a final number." End quote. Since then, the real number has been calculated to be $71 million below expected revenues.

Also this week we had a lighter subject to address. The House Federal and State Affairs committee advanced a bill to name Little Bluestem as the official state grass. The bill was the result of the work of Kansas schoolchildren who presented testimony in committee. It was one of the more enjoyable committee meetings so far this year. I wish I had more good news to share with all of you.

Mitch Holmes ini the Kansas State Representative for the Kansas House District 114.  His email is campaign@mitchholmes.com
 

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